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| C     |                                                              |
| omptr |                                                              |
| oller |                                                              |
| of    |                                                              |
| the   |                                                              |
| Cur   |                                                              |
| rency |                                                              |
|       |                                                              |
| Adm   |                                                              |
| inist |                                                              |
| rator |                                                              |
| of    |                                                              |
| Nat   |                                                              |
| ional |                                                              |
| Banks |                                                              |
+-------+--------------------------------------------------------------+

Licensing Operations

Southwestern District Office

1600 Lincoln Plaza

500 North Akard

Dallas, Texas 75201-3342

October 5, 2001 **Conditional Approval #496**

**November 2001**

Peter G. Weinstock

Attorney

Jenkens & Gilchrist, PC

1445 Ross Avenue, Suite 3200

Dallas, Texas 75202-2799

Re: Purchase and Assumption by First National Bank of Bridgeport,
Bridgeport, Texas of the Decatur, Texas branch of Jefferson Heritage
Bank, FSB, Denton, Texas. Application Control No. 2001-SW-02-0031

Dear Mr. Weinstock:

This is to inform you that today the Office of the Comptroller of the
Currency (OCC) has conditionally approved the application to purchase
the assets and assume the liabilities of the Decatur, Texas branch of
Jefferson Heritage Bank, FSB, Denton, Texas by First National Bank of
Bridgeport, Bridgeport, Texas. This conditional approval is granted
based on a thorough review of all information available, including
commitments and representations made in the application and the purchase
and assumption agreement and those of your representatives. A copy of
the OCC's decision document is enclosed.

This approval is subject to the condition that FNB must achieve a 7%
leverage ratio by March 31, 2002. This condition is considered to be a
condition imposed in writing by the agency in connection with the
granting of any application or other request within the meaning of 12
USC 1818. As such, this condition is enforceable under 12 USC 1818.

You are also reminded that the supervisory office will monitor the
bank's compliance with its capital plan on an ongoing basis.

Mr. Peter Weinstock

2001-SW-02-0031

Page 2

As a reminder, the district office must be advised in writing in advance
of the desired effective dates for the purchase and assumption so that
the OCC may issue the necessary certification letter. The effective date
must be at least 15 days after the date of this letter. If the purchase
and assumption is not consummated within one year from the approval
date, the approval shall automatically terminate, unless the OCC grants
an extension of the time period.

This conditional approval, and the activities and communications by OCC
employees in connection with the filing, do not constitute a contract,
express or implied, or any other obligation binding upon the OCC, the
U.S., any agency or entity of the U.S., or an officer or employee of the
U.S., and do not affect the ability of the OCC to exercise its
supervisory, regulatory and examination authorities under applicable law
and regulations. The foregoing may not be waived or modified by any
employee or agent of the OCC or the U.S.

A separate letter is enclosed requesting your feedback on how we handled
your application. We would appreciate your response so we may improve
our service. If you have questions, please contact Senior Licensing
Analyst Brenda E. McNeese or me at (214) 720-7052.

Yours truly,

**-signed-**

Pansy G. Hale

Acting Licensing Manager

Enclosure

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| ## O  | ###                                                          |
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| C     |                                                              |
| omptr |                                                              |
| oller |                                                              |
| of    |                                                              |
| the   |                                                              |
| Cur   |                                                              |
| rency |                                                              |
|       |                                                              |
| Adm   |                                                              |
| inist |                                                              |
| rator |                                                              |
| of    |                                                              |
| Nat   |                                                              |
| ional |                                                              |
| Banks |                                                              |
+-------+--------------------------------------------------------------+

Licensing Operations

Southwestern District Office

1600 Lincoln Plaza

500 North Akard

Dallas, Texas 75201-3342

DECISION OF THE COMPTROLLER OF THE CURRENCY ON THE APPLICATION TO
PURCHASE CERTAIN ASSETS AND ASSUME CERTAIN LIABILITIES OF THE DECATUR,
TEXAS BRANCH OF JEFFERSON HERITAGE BANK, FSB, DENTON, TEXAS BY FIRST
NATIONAL BANK OF BRIDGEPORT, BRIDGEPORT, TEXAS

APPLICATION CONTROL NUMBER 2001-SW-02-0031

######## 

######## 

######## Introduction

On August 7, 2001, application was made to the Office of the Comptroller
of the Currency (hereafter "OCC") for approval of the purchase of
certain assets and assumption of certain liabilities of the Decatur,
Texas Branch of Jefferson Heritage Bank, FSB, Denton, Texas (hereafter
"Jefferson") by First National Bank of Bridgeport, Bridgeport, Texas
(hereafter "FNB"). The application was based on a purchase and
assumption agreement entered into between the proponents on July 19,
2001.

######## Participating Financial Institutions

As of June 30, 2001, Jefferson had deposits of \$19 million and operated
the one office. On the same date, FNB had total deposits of \$98 million
and operated two offices. FNB is owned by a one bank holding company.

######## Competitive Analysis

The relevant geographic market for analyzing the competitive effect of
this proposal is the Wise County, Texas banking market. This market
consists of all of Wise County except the area around Boyd, Newark, and
Rhome in the southeast corner of the county, which is in the Fort Worth
market. The Wise County banking market is the area where competition
between FNB and JHB's Decatur branch is direct and immediate.

DECISION

2001-SW-02-0030

Page 2

As of June 30, 2000, FNB ranked second in the relevant geographic market
with \$58 million in deposits, or 18 percent of the market share of
total deposits. The Decatur branch of Jefferson ranks sixth with \$23
million in deposits, or 7 percent of the market share of total deposits.
After the transaction, FNB will have a 26 percent market share of total
deposits and continue to rank second in the market. Following the
elimination of Jefferson from the market, FNB will compete with five
other banking alternatives. These alternatives include The First
National Bank of Texas, a subsidiary of a \$2 billion bank holding
company with 34 percent of the market share, First American Bank, a \$2
billion thrift with 15 percent of the market and three small locally
owned banks.

The purchase and assumption will eliminate one competitor in the market;
any adverse effect would be mitigated by the presence of six other
banking alternatives. Therefore, consummation of this proposal will not
have a significantly adverse effect on competition in this relevant
geographic market.

######## Banking Factors

The Bank Merger Act requires the OCC to consider \"\...the financial and
managerial resources and future prospects of the existing and proposed
institutions, and the convenience and needs of the community to be
served.\" We find that the financial and managerial resources of
Jefferson and FNB do not raise concerns that would cause the application
to be disapproved. However, the capital ratios of the resulting bank
will decline as a result of this transaction. Therefore, a condition to
increase FNB's leverage ratio to 7% by March 31, 2002 was imposed.

Customers of both banks will continue to have access to the resulting
bank. FNB currently offers a full line of banking services and there
will be no changes in its products or services as a result of this
transaction. The future prospects of the proponents, individually and
combined, are considered favorable and the resulting bank is expected to
meet the convenience and needs of the community to be served.

######## Community Reinvestment Act

A review of the record of this application and other information
available to the OCC as a result of its regulatory responsibilities has
revealed Jefferson and FNB's record of meeting the credit needs of its
community, including low- and moderate-income neighborhoods, is
satisfactory. Therefore, there is no reasonable basis for objecting to
this application due to concerns with the Act.

DECISION

2001-SW-02-0030

Page 3

######## Conclusion

We have analyzed this proposal pursuant to the Bank Merger Act (12
U.S.C. 1828(c)) and find that it will not lessen significantly
competition in any relevant market. Other than the decline in FNB's
capital ratios all other factors considered in evaluating this proposal
are satisfactory. Accordingly, the application is conditionally
approved.

**/s/**

Pansy G. Hale

Acting Licensing Manager

Date: October 5, 2001