AMENDMENT NO. 1 TO EMPLOYMENT AGREEMENT

AMENDMENT NO. 1 TO EMPLOYMENT AGREEMENT

     This AMENDMENT NO. 1 TO EMPLOYMENT AGREEMENT (“Amendment No. 1”) is entered into as of the 31^st day of December, 2006 (the “Effective Date”), and amends that certain EMPLOYMENT AGREEMENT dated as of September 20, 2004 (the “Employment Agreement”) by and between AmericanWest Bancorporation, a Washington corporation (“AWBC”), its wholly owned subsidiary AmericanWest Bank, a Washington state-chartered bank (the “Bank” and together with AWBC, “Employer”), and Greg Hansen (“Executive”).

     SECTION 1. Subdivision (a) of Section 12 of the Employment Agreement is hereby amended to read, in its entirety, as follows:

     (a) Death; Disability; Resignation without Good Reason; Termination for Cause.

     If Executive’s employment is terminated as a result of death, Disability, resignation without Good Reason or termination for Cause pursuant to Sections 11(a), (b), (c), or (f) respectively, Executive shall receive as of the Date of Termination:

        (1)      his base salary through the Date of Termination;

        (2)      any incentive compensation earned for any performance period completed on or before the Date of Termination but not yet paid; and

        (3)      reimbursement of expenses described in Section 7(e) incurred as of the Date of Termination but not yet reimbursed.

     SEC. 2. Subdivision (b) of Section 12 of the Employment Agreement is hereby amended to read, in its entirety, as follows:

    (b)      Change of Control.

        (1)     At any time within the first year following a Change of Control (as defined in Section 17), Executive shall have the right, at his sole option, to terminate this Agreement by giving Employer ninety (90) days' written notice thereof. If, following a Change in Control, either (A) Executive exercises his right to terminate this Agreement pursuant to this paragraph, or (B) within two (2) years following the effective date of such Change in Control, Executive terminates his employment for Good Reason pursuant to Section 11(d) or Employer terminates Executive without Cause pursuant to Section 11(e), Executive shall receive:

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             (i) An amount equal to two (2) times Executive's then-current annual base salary, plus an amount equal to Executive's bonus for the year immediately preceding any such termination; provided, however, that if such termination occurs in 2005, the bonus shall be the amount of Executive’s bonus paid in January, 2005, pursuant to Section 7(b)(1);

             (ii) Any incentive compensation earned for any performance period completed on or before the Date of Termination but not yet paid;

             (iii) Reimbursement of expenses described in Section 7(e) incurred as of the Date of Termination but not yet reimbursed; and

             (iv) Immediate acceleration of vesting of all stock options granted to Executive.

         (2) The payment to which Executive is entitled pursuant to subparagraphs (i) and (ii) of Section 12(b)(1) shall be paid in equal monthly installment payments paid over the Restricted Period, as defined in Section 13(a), with no percent value or other discount.

         (3) Executive shall not be required to mitigate the a