OVERVIEW

The following is management's discussion and analysis of particular events or circumstances that have affected the Company's financial condition or results of operations during the periods presented in this filing. Our common stock is listed on the Nasdaq Global Market ("NASDAQ") under the symbol "TFIN."

Team Financial, Inc. is currently a bank holding company incorporated in the State of Kansas. We offer full service community banking and financial services through 21 locations in Kansas, Missouri, Nebraska and Colorado through our wholly owned banking subsidiaries, TeamBank, N.A and Colorado National Bank (the "Banks"). Our presence in Kansas consists of nine locations in the Kansas City metropolitan area and three locations in southeast Kansas. We operate two locations in south-western Missouri, three in the metropolitan area of Omaha, Nebraska, and four in the Colorado Springs, Colorado metropolitan area.

Our results of operations depend primarily on net interest income, which is the difference between interest income from interest-earning assets and interest expense on interest-bearing liabilities. Our operations are also affected by non-interest income, such as service charges, loan fees, and gains and losses from the sales of mortgage loans. Our principal operating expenses, aside from interest expense, consist of compensation and employee benefits, occupancy costs, data processing expense and provisions for loan losses.

We recorded a net loss of $7.0 million, or $1.95 basic and $1.95 diluted loss per share for the three months ended June 30, 2008, compared to net income of $1.41 million, or $0.39 basic and $0.38 diluted income per share for the three months ended June 30, 2007. During the six months ended June 30, 2008, we recorded a net loss of $13.4 million, or $3.74 basic and $3.71 diluted loss per share. The net loss of $7.0 million during the three months ended June 30, 2008 was primarily as a result of $4.7 million in goodwill impairment added to $4.0 million in provisions for loan losses as it was determined during the quarter that additional allowances for loan losses would be made to absorb losses in our loan portfolio related to the further decline in the real estate market in our areas of operation. The net loss of $13.4 million during the six months ended June 30, 2008 was primarily due to a non-cash $10.7 million impairment charge for the write-off of our

goodwill associated with Colorado National Bank during the first quarter and TeamBank, N.A. in the second quarter, coupled with $6.7 million in provisions for loan losses.

The following table presents selected financial data for the three and six months ended June 30, 2008 and 2007 (dollars in thousands, except per share data):

                                       As of and For           As of and For
                                     Three Months Ended       Six Months Ended
                                          June 30                 June 30
                                      2008         2007        2008       2007
Net income (loss)                  $    (7,024 )  $ 1,411   $  (13,436 ) $ 2,579
Basic income (loss) per share      $     (1.95 )  $  0.39   $    (1.79 ) $  0.72
Diluted income (loss) per share    $     (1.95 )  $  0.38   $    (1.77 ) $  0.70
Return on average assets                 -3.40 %     0.74 %      -1.62 %    0.68 %
Return on average equity                -52.00 %    10.98 %     -24.86 %   10.17 %
Average equity to average assets          6.55 %     6.76 %       6.51 %    6.71 %
Efficiency Ratio                        153.38 %    75.07 %     152.61 %   76.29 %

Critical Accounting Policies

Our accounting and reporting policies conform to U.S. generally accepted accounting principles. In preparing the consolidated financial statements and related notes, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities as of the date of the statement of financial condition and revenues and expenses for the periods presented. Actual results could differ significantly from those estimates. The Company's significant accounting policies are more fully described in Note 1 to the consolidated financial statements contained in the Company's Annual Report on Form 10-K/A for the year ended December 31, 2007, and significant assumptions and estimates made by management are more fully described in "Management's Discussion and Analysis of Financial Condition and Results of Operations" under "Critical Accounting Policies" in the Form 10-K/A. As a result of a review of various national banking-related publications, as well as a pronouncement of, and discussions with, our primary banking regulator, the Office of the Comptroller of the Currency (the "OCC"), and in response to additional data becoming available, the assumptions and estimates of the allocations attributable to deteriorating market conditions in our allowance for loan loss calculation were significantly increased as of March 31, 2008 and June 30, 2008. We recorded a provision for loan losses of $4.1 million and $6.7 million during the three and six months ended June 30, 2008, which was primarily related to the increased estimates of the allocations attributable to the foregoing regulatory guidance and deteriorating market conditions. There have been no other material changes to our critical accounting policies or the estimates made pursuant to those policies during our most recent quarter.

Regulatory Environment

In connection with a recent examination of our subsidiary banks, on April 24, 2008, the Banks each received a letter from the OCC, Kansas City South Field office, indicating that it believes the Banks are deemed to be in "troubled condition" for purposes of Section 914 of the Financial Institutions Reform, Recovery, and Enforcement Act of 1989, and, as a result, the Banks are subject to specified restrictions on operations. These letters were received before the OCC's issuance of its examination report and were based upon the OCC staff's determination that the Banks had deficiencies in credit administration practices, loan risk rating systems, loan loss allowance methodologies, and levels of classified assets. The restrictions provide that: (1) the Banks must notify the OCC 90 days before adding or replacing a member of their respective boards of directors or employing any, or promoting any existing employee as a senior executive officer, and (2) the Banks may not, except under certain circumstances, enter into any agreements to make severance or indemnification payments or make any such payments to institution-affiliated parties. We expect to cooperate with the OCC to address any regulatory concerns.

As a result of the recent OCC examination and areas of concern, the Banks' Boards expect to sign a formal enforcement action with the OCC to document and address the areas of concern. The areas of concern include, but are not limited to, developing a plan to increase capital of the Banks, addressing credit administration and monitoring deficiencies, as well as previously noted items in the "troubled condition" letter. We anticipate the expected enforcement action will require us to raise additional capital. The Banks will continue to pursue methods to increase regulatory capital ratios, closely monitor classified and non-performing assets, and reduce the levels of concentrations. The previously announced merger between TeamBank, N.A. and Colorado National Bank is on hold pending resolution of the above noted issues.

On July 13, 2008 the Federal Reserve Bank of Kansas City provided the Company with notice that it has determined that the Company is also deemed to be in "troubled condition". As such, the Company is subject to restrictions similar to those of the Banks. Because the Company is required to provide the Federal Reserve Bank of Kansas City with advance notice of any proposed change in the members of the Board of Directors, the Company has provided the Federal Reserve Bank of Kansas City with the required notice and information regarding the Company's two proposed nominees that are up for election at this year's annual shareholder's meeting rescheduled for August 19, 2008. We do not expect that the Federal Reserve Bank of Kansas City will object to either nominee.

Corporate Governance Matters

On June 16, 2008, we entered into an agreement (the "Bicknell Agreement") with several stockholders known as the Bicknell Group, who are a "group" as defined in Rule 13d-5 promulgated by the Securities and Exchange Commission. The Bicknell Agreement addresses several corporate governance matters relating to the Company. Under the Agreement, the Company agreed to postpone or adjourn its 2008 Annual Meeting of Stockholders which was originally set for June 17, 2008, in order to resolicit proxies for a revised slate of Class III Director nominees to be elected at a reconvened meeting. The reconvened meeting is scheduled for August 19, 2008. The Bicknell Group has agreed to vote in favor of the revised slate to be nominated by the Company which includes existing director, Robert Blachly; former chief financial officer and director of the Company, Richard J. Tremblay; and Jeffery L. Renner, a current non-management nominee to the Board of Directors. Those nominations are subject to non-objection by the Company's banking regulator in the case of Mr. Tremblay and Mr. Renner.

In conjunction with the Bicknell Agreement, Carolyn Jacobs and Denis Kurtenbach have declined to stand for nomination as Class III directors. In addition, independent director, Harold G. Sevy, Jr. has agreed to tender his resignation as a director effective no later than the reconvened meeting so that the number of Board positions will be reduced to eight directors.

In addition, the Bicknell Agreement provides that the Company's Strategic Planning Committee of the Board will be reconstituted to consist of Connie Hart, Jeffery Renner and Richard Tremblay, with Ms. Hart serving as chairperson. Also the Audit Committee of the Board will be composed of Greg Sigman, who will serve as chairperson, Connie Hart and Jeffery Renner. The Nominating Committee will be composed of Robert Blachly, who will be the chairperson, Gregory Sigman and Kenneth Smith. The Compensation Committee will be composed of Kenneth Smith, who will be chairperson, Connie Hart and Jeffery Renner. Consistent with regulatory requirements and committee charters, all other directors will have the right to participate in committee meetings as observers.

The Company also agreed to not extend its Rights Agreement with American Securities Transfer & Trust, Inc., as rights agent, beyond the expiration date of June 3, 2009 or adopt any similar agreement without stockholder approval. The Company further agreed to seek to eliminate its classification of the Board of Directors so that annually all directors will stand for re-election, which will not take place until the 2009 Annual Meeting.

Under the Bicknell Agreement, the Company will move forward with its plan to have Connie Hart, an independent director, become chairperson of the Board, as previously announced.

The Bicknell Group, which owns 427,025 shares of common stock, or 11.9% of the outstanding shares, agreed to refrain from any tender offer, exchange offer, merger or business combination with the Company as well as to refrain from any solicitation of proxies until the earlier of the 2009 Annual Meeting or June 30, 2009. Also, prior to the 2009 Annual Meeting, the Bicknell Group agreed not to propose any matter to submission to the Company's stockholders or to seek to amend any provision of the Company's Articles of Incorporation or bylaws.

On July 10, 2008 we entered into a settlement agreement (the "Edquist Agreement") with shareholder and former director Keith B. Edquist with respect to the Company's 2008 Annual Meeting of Shareholders and related matters. The 2008 Annual Meeting of Shareholders was originally scheduled for June 17, 2008, but was postponed.

Under the terms of the Edquist Agreement, Mr. Edquist has agreed to terminate his efforts to nominate persons for election as Class III directors at the Company's 2008 Annual Meeting of Shareholders, has agreed to vote his shares in favor of the Company's nominees for director at the 2008 Annual Meeting (Robert M. Blachly, Jeffrey L. Renner

and Richard J. Tremblay), and has agreed to abide by certain standstill provisions until the earlier of June 30, 2010 or the Company's 2010 Annual Meeting. As part of the settlement, the parties executed a mutual release as well.

Additionally, under the terms of the Edquist Agreement, the Company has agreed to reimburse Mr. Edquist for certain expenses related to his proxy solicitation efforts. Under the reimbursement arrangement, Mr. Edquist will receive approximately $22,572 monthly through January 1, 2009, for a total of approximately $158,000.

Mr. Edquist's obligations are contingent on the Bicknell Agreement remaining in full force and effect.

FINANCIAL CONDITION

Total assets at June 30, 2008, were $807.3 million compared to $827.5 million at December 31, 2007, a decrease of $20.2 million, or 2.4%. This decrease was primarily a result of a decrease in cash and cash equivalents of $12.7 million coupled with a decrease in investment securities of $11.0 million and the goodwill write-off of $10.7 million, offset by an increase in loans receivable of $16.4 million. Total deposits decreased $24.8 million to $604.6 million at June 30, 2008 compared to $629.4 million at December 31, 2007. The decrease in total deposits was primarily due to a decrease in checking deposits and money market deposits of $18.1 million and $14.8 million, respectively. The decrease in checking deposits and money market deposits, and the interrelated decrease in cash and cash equivalents, was primarily a result of the normal fluctuation of public funds deposits.

Investment Securities

Total investment securities were $164.3 million at June 30, 2008, compared to $175.3 million at December 31, 2007, a decrease of $11.0 million, or 6.3%. This decrease was primarily due to management's decision not to reinvest called investments in the securities markets. Management does not believe that any of the securities with unrealized losses at June 30, 2008 are other than temporarily impaired, other than those discussed below.

During the three months ended June 30, 2008 a portion of our securities portfolio was determined to be other than temporarily impaired by approximately $0.9 million. The impairment was the result of current market conditions related to trust preferred securities issued by other financial institutions that the Company holds as investments. These securities are classified as Other debt securities in the tables that follow.

The following tables set forth a summary of the contractual maturities in the investment portfolio at June 30, 2008 and December 31, 2007.

                                                    Over one year          Over five years
                          One year or less       through five years       through ten years        Over ten years            Total
                          Amount      Yield        Amount       Yield       Amount      Yield     Amount     Yield      Amount     Yield
                                                                     (Dollars In Thousands)
Government-sponsored
entities                $    1,004      3.25 %  $      3,403     3.00 %  $      7,060    5.22 %  $  10,453     5.56 %  $ 21,920      5.13 %
Obligations of states
and political
subdivisions            $      508      4.19    $      7,312     4.27    $     10,045    3.97    $  16,861     4.87    $ 34,726      4.48
Other                            -                         -                      345    6.02        2,726     5.22    $  3,071      5.29
                        $    1,512              $     10,715             $     17,450            $  30,040             $ 59,717
Mortgage-backed
securities                                                                                                             $ 94,779      5.17
Equity Securities                                                                                                         9,838
Total investment
securities                                                                                                              164,334

                                                       Over one year      Over five years
                         One year or less       through five years       through ten years      Over ten years            Total
                         Amount      Yield       Amount       Yield       Amount      Yield     Amount    Yield     Amount     Yield
                                                                   (Dollars In Thousands)
Government-sponsored
entities                  $7,497       3.74 %      $8,820       3.86 %      $26,327    5.19 %    $8,581     5.25 %  $51,225      4.76 %
Obligations of states
and political
subdivisions                $399       4.41        $8,086       4.35         10,937    3.96      13,265     5.17    $32,687      4.55
Other                          -                        -                       448    6.02       3,325     5.15     $3,773      5.25
                          $7,896                  $16,906                   $37,712             $25,171             $87,685
Mortgage-backed
securities                                                                                                          $78,002      5.15
Equity Securities                                                                                                     9,654
Total investment
securities                                                                                                          175,341

Loans Receivable

Loans receivable increased $16.4 million, or 2.9%, to $577.2 million at June 30, 2008, compared to $560.9 million at December 31, 2007. This increase was primarily due to a $16.2 million increase in construction and land development loans which was largely driven by commitments and lines of credit previously in existence.

Our loan originations have declined in recent months. In addition to an overall weak economy that has led to a decreased demand for our loan products, management has determined not to actively pursue loan growth in order to sustain capital levels and capital ratios. As such, we do not anticipate loan growth consistent with loan growth of previous periods, and we may seek to decrease our loan balances in order to provide for increased levels of capital ratios and liquidity.

We currently have a high concentration in real estate and construction and land development loans. The current economic downturn in the housing market, particularly as it relates to our market areas, coupled with our high concentration in these loans, has increased allowances for loan losses and increased levels of capital to provide protection from losses if market conditions deteriorate further. In order to provide ample capital ratios and decrease our concentration in real estate construction and land development loans, we may decrease these loan balances in the near future through a variety of channels, including but not limited to loan sales to other financial institutions. However, the economic downturn in the real estate market has led to a decreased market for such loan sales, and we cannot assure that we will be successful in lowering our concentration in real estate and construction and land development loans in the near future. Management does not have an estimate of how long the currently challenging operating environment will persist.

The following table presents the composition of our loan portfolio by type of loan at the dates indicated.

                                                June 30, 2008             December 31, 2007
                                           Principal     Percent of    Principal     Percent of
                                            Balance        Total        Balance        Total
                                                          (Dollars in thousands)
Loans secured by real estate:
One-to-four family                         $   77,300          13.4 %  $   77,961          13.9 %
Construction and land development             226,249          39.2       210,083          37.4
Commercial                                    160,901          27.9       156,085          27.7
Farmland                                       33,311           5.8        28,380           5.1
Multifamily                                     3,581           0.6         3,855           0.7
Commerical and industrial                      52,208           9.0        59,770          10.7
Agricultural                                    7,463           1.3         8,350           1.5
Installment loans                               9,115           1.6        10,506           1.9
Obligations of state & political
subdivisions                                    6,981           1.2         5,628           1.0
Lease financing receivables                       795           0.1           993           0.2
Gross loans                                   577,904         100.1       561,611         100.1
Less unearned fees                               (673 )        (0.1 )        (750 )        (0.1 )
Total loans receivable                     $  577,231         100.0 %  $  560,861         100.0 %

Included in one-to-four family real estate loans were loans held for sale of approximately $2.9 million at June 30, 2008 and $1.9 million at December 31, 2007.

Non-performing Assets

Non-performing assets consist of loans 90 days or more delinquent and still accruing interest, non-accrual loans, restructured loans and assets acquired through foreclosure. Loans are generally placed on non-accrual status when principal or interest is 90 days or more past due, unless the loans are well-secured and in the process of collection. Loans may be placed on non-accrual status earlier when, in the opinion of management, reasonable doubt exists as to the full, timely collection of interest or principal.

The following table summarizes our non-performing assets at the dates indicated:

                                                          June 30, 2008     December 31, 2007
                                                                (Dollars in thousands)
Nonaccrual loans                                         $        23,439                6,069
Loans 90 days past due and still accruing                            899                  233
Restructured loans                                                   655                  669
Nonperforming loans                                               24,993                6,971
Assets acquired through foreclosure                                3,003                  934
Total nonperforming assets                               $        27,996                7,905
Nonperforming loans as a percentage of total loans                  4.33 %               1.24 %
Nonperforming assets as a percentage of total assets                3.47 %               0.96 %

Information regarding impaired loans is summarized as follows:

                                                          June 30, 2008      December 31, 2007
                                                                 (Dollars in thousands)
Impaired loans for which a related allowance has been
provided                                                 $        10,768    $             5,471
Impaired loans for which a related allowance has not
been provided                                                     12,671                  1,439
Total impaired loans                                     $        23,439    $             6,910

Allowance related to impaired loans                      $         2,890    $               648

We have seen a significant increase in non-performing loans since December 31, 2007. Non-performing assets totaled $28 million at June 30, 2008, compared to $7.9 million at December 31, 2007, representing an increase of approximately $20.1 million, or 254.2%. Non-performing loans were the largest component of non-performing assets during both periods, and were approximately $25.0 million at June 30, 2008 compared to $7.0 million at December 31, 2007, an increase of approximately $18.0 million, or 257.1%.

We are experiencing a trend of increasing non-performing loans as well as classified loans that are not yet considered non-performing as a result of the current difficult economic conditions being experienced in our market areas and nationwide. The slowdown in the housing market has impacted some of our borrowers and their ability to repay according to their original terms, especially those with construction and land development loans. Although we believe that many of these loans are adequately collateralized, we are actively working with these borrowers to minimize any loss exposure that the Company may be subject to as a result of the slowdown in the economy.

The increase in non-performing loans during the six months ended June 30, 2008 was largely due to a $17.4 million increase in non-accrual loans primarily as a result of several groups of real estate loans totaling approximately $15.5 million that were on non-accrual status at June 30, 2008, but at December 31, 2007 were performing and accruing interest. Non-accrual loans increased $11.6 million from the March 31, 2008 total of $11.8 million. The largest area of non-accrual loans include $15.5 million in commercial real estate loans, of which $8 million are located in the Colorado Springs market, $3.2 million in the Kansas City area market, and $2.7 million are participations with other banks. Subsequent to June 30, 2008, interest was received in full on non-accrual loans totaling $8.0 million. In addition, this borrower pledged additional collateral and prefunded additional interest. For the next few months, interest on these loans will be recognized on the cash basis. These loans will be returned to accrual status after adequate performance is demonstrated.

Subsequent to June 30, 2008, we have experienced an increase of $1.9 million in non-accrual loans, and as of August 15, 2008, we estimate that non-accrual loans totaled $25.3. million, an increase from the June 30, 2008 total of $23.4 million.

Loans 90 days past due and still accruing interest amounted to $899,000 as of June 30, 2008, and increased $666,000 over December 31, 2007. The increase in loans 90 days past due and still accruing interest at June 30, 2008, compared to December 31, 2007, resulted primarily from a single loan totaling $617,000 in the Colorado Spring market. Subsequent to June 30, 2008, loans 90 day past due . . .