Citizens Bancshares, Inc.
                                
                          Annual Report
                                
                              1998
                                        PRESIDENT'S MESSAGE

March 8, 1999


Dear Shareholder:

The  Board  of  Directors and Management  thank  you,  our  loyal
shareholder, for the support and confidence you have  continually
entrusted to the management, directors, and employees of Citizens
Bank and Citizens Bancshares, Inc.

As we approach the end of another successful year, we are pleased
to  report  another  year of significant  growth  and  consistent
earnings.  For the year ended December 31, 1998, assets increased
by  $7  million  to $105 million, with significant  increases  in
loans, investments, deposits, and equity position.  The 1998 cash
dividends   paid   to  shareholders  totaled  $0.85   per   share
representing   a   21%  increase  over  last  year's   dividends.
Management anticipates continued Bank growth and increases in the
value of your Holding Company investment.

As  part of the expansion and modernization project completed  in
1998,  Citizens Bank converted its data processing to an in-house
system.   A principal objective of this conversion was to acquire
new  computers  and related software and equipment  to  meet  the
Bank's  needs into the Year 2000 and beyond.  Based on conversion
and  assessment  efforts  completed to  date,  the  Bank's  date-
sensitive systems have been vendor-certified as Year 2000  ready.
Our  continuing  efforts  are  aimed at  providing  uninterrupted
customer service into the new millennium and beyond.

All  Board  members, managers, and employees remain committed  to
providing the best and most personal banking service possible  --
that's  "hometown  banking."  With "hometown banking,"  decisions
are made quickly and locally by hometown people who live and work
here, who understand our area's culture, and who are committed to
serving  community  and  individual  needs.   Our  commitment  to
serving  the banking needs of Evangeline Parish continues  to  be
our principal focus.

Sincerely yours,



Carl W. Fontenot,
President & CEO

        MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
               CONDITION AND RESULTS OF OPERATIONS


GENERAL INFORMATION

For a comprehensive review of financial condition and results  of
operations  of  Citizens Bancshares, Inc. (the  "Company"),  this
discussion  and  analysis  should  be  reviewed  along  with  the
information and financial statements presented elsewhere in  this
report.   The  Company is a one-bank holding company  whose  sole
subsidiary  is  Citizens  Bank,  Ville  Platte,  Louisiana   (the
"Bank").

Citizens Bank is a commercial banking institution formed in  1975
under  the  banking  laws of the State of  Louisiana.   The  Bank
operates  a  main  office located in the City  of  Ville  Platte,
Louisiana  with branch facilities in the Town of Mamou, Louisiana
and the Village of Pine Prairie, Louisiana.  Citizens Bank offers
a  full  range of services, including demand, savings,  and  time
deposits,  consumer,  commercial, agricultural  and  real  estate
loans,  safe  deposit boxes and two credit card plans,  VISA  and
MasterCard.  Drive-through facilities are located at all  banking
locations,  including a drive-through ATM  machine  at  the  Main
Office in Ville Platte, Louisiana.

YEAR 2000

In   late  1997,  Citizens  Bank  decided  to  convert  its  data
processing operations from outsource service bureau operations to
an in-house operation.  When this decision was made, all hardware
and  software  data processing acquisitions were  made  with  the
awareness  and  objective of satisfying the Year 2000  compliance
and  conformity  issues.   After successful  conversion  of  data
processing  operations  from  a service  bureau  to  an  in-house
operation, Citizens Bank's Board of Directors adopted an Electric
Data Processing Policy that included a Year 2000 Program policy.

A  Y2K  Committee, chaired by a board-appointed Y2K  Coordinator,
was  formed  in  early  1998 to address Year  2000  issues.   The
Committee's  objective  is  to  monitor  and  report  the  Bank's
progress  in  achieving  Year  2000 compliance  for  all  mission
critical  applications.  In addition to monitoring,  testing  and
identifying appropriate changes to in-house operations,  the  Y2K
committee  continues to monitor Year 2000 status  of  the  Bank's
customers, service providers, and suppliers.

As   of  December  31,  1998,  Citizens  Bank  had  substantially
completed    remediating    and    obtaining    Y2K    compliance
certifications,  on  its mission critical systems.   Testing  and
validations  of  mission  critical  systems  are  scheduled   for
completion  in early 1999 and monitoring of Year 2000  compliance
will  be  accomplished throughout 1999.  Written acknowledgements
have  been  received  from  all  mission  critical  hardware  and
software providers, utility and telephone service providers,  and
date  processing  service providers assuring timely  remediation,
testing and validation for year 2000 compliance.

The Bank expects to continue incurring expense charges related to
Year 2000 compliance through the remainder of 1998 and throughout
1999; the majority of costs associated with year 2000 compliance,
however,  is  the  responsibility of the Bank's  data  processing
vendors and service providers.  Estimated expenses charges to  be
borne  directly by the Bank will total $3,000 per  month  through
1999.   These  Year 2000 expenses will be included in noninterest
expense  categories  and  do not include equipment  and  software
scheduled replacement in the ordinary course of business.

The  Bank's  estimate  of  Year 2000  investment  costs  and  the
estimated time periods set forth above by which the Bank  expects
to substantially complete mission critical system programming and
testing  and  implementation  are based  upon  management's  best
current   estimates,  which  were  delivered  utilizing  numerous
assumptions about future events.  There can be no guarantee  that
these estimates will be achieved, and actual results could differ
from  those anticipated.  Because of the critical nature  of  the
Year  2000  issues  to our business and to all of  the  financial
services  industry, if necessary modifications are not  made  the
Bank's  operations could be materially impacted.   Citizens  Bank
and  its  data  processing  vendors remain  scheduled  to  ensure
achievement of Year 2000 compliance, therefore, an adverse impact
on the Bank's operations is not expected.

FINANCIAL CONDITION

Total  assets  increased by $7,167,000 to $105,124,000,  a  7.31%
increase  over  the year-end 1997 total asset level.   Management
feels  the bank will continue to grow in core deposits and  loans
in the future due to personal service provided by the employees.

Earning  assets  were 93.72% of total assets for year-end,  which
includes  loans, investment securities, federal  funds  sold  and
deposits in other banks.

Lending  is  vital function of the bank and remains  the  primary
source  of  income.  With the available resources, the Bank  will
continue to make sound loans under the guidelines of our  written
Loan  Policy  and  Community  Reinvestment  Act  Policy.   As  of
December  31, 1998, loans (net of the allowance for loan  losses)
increased  $6,068,000 or 13.18%, which increased the Bank's  loan
to deposit ratio to 55.49%.

The  Bank  maintains an allowance for loan losses  against  which
impaired or uncollectible loans are charged.  The balance in  the
allowance for loan losses was $1,001,000 as of December 31, 1998,
which  represents  1.88%  of  total  loans.   Provisions  to  the
allowance for loan losses that were charged to net income totaled
$103,000.  Management evaluates the adequacy of the allowance for
loan losses on a monthly basis by monitoring the balance in total
loans  as well as the past due, nonaccrual, classified and  other
problem loans.  Based on this evaluation, the allowance for  loan
losses is considered adequate to meet possible future charges for
losses in the loan portfolio.

Citizens Bank follows a close policy in evaluating past due loans
and  their  placement in nonaccrual status, as  required  by  the
Bank's  loan policy.  The policy states that any loan  delinquent
for   a  period  of  ninety  (90)  days,  unless  the  collateral
supporting  the loan is sufficient to cover the accrued  interest
in   addition  to  the  principal  balance  and  in  process   of
collection, will be placed in nonaccrual status.  Such loans  are
not   charged-off;  however,  interest  is  no  longer  accruing.
Accrued interest is charged either against interest income or the
allowance  for  possible loan losses at the time a  loan  becomes
nonaccrual,  depending  on the reporting  period  in  which  such
interest  had  accrued.  Nonaccrual loans  totaled  $136,000  and
loans  past  due  ninety  (90) days or more  and  still  accruing
interest totaled $172,000 for year ended December 31, 1998.  Past
due loans to total loans were 2.22% for the same period.

Another  primary  source  of  income is  interest  on  investment
securities.  Citizens Bank maintains a written investment policy.
This  Policy  provides  for investments  that  produce  secondary
income,  as  well  as  liquidity needs.  Management  follows  its
policy strictly to assure high-grade investments of bank quality.
The   Bank   categorizes  and  accounts  for   these   securities
investments  as "held to maturity" or "available  for  sale",  as
required by Financial Accounting Standards Board Statement  #115.
No  investment  securities are held in trading accounts.   As  of
December 31, 1998, securities classified as held to maturity  had
an amortized cost of $8,125,000 and a market value of $8,274,000.
The  securities classified as available for sale had an amortized
cost of $26,465,000 and a market value of $26,513,000.

Deposits,  both  time and demand, represent the chief  source  of
funds for the Bank.  At the end of 1998, total deposits increased
$6,498,000  or  7.43%.  Much of the increase is in  Saving,  NOW,
Money Market deposits and other time deposits.

RESULTS OF OPERATIONS

The  Company  reported a net income of $1,023,000  or  $8.90  per
average share outstanding as of December 31, 1998.  Net return on
assets was .97% and net return on equity was 9.86%.

The  Company's principal source of revenue is net interest income
which  is  measured  by  the difference between  interest  income
earned on loans and investments and interest expense incurred  on
deposits.   The  Company's net interest income for  December  31,
1998  was  $3,253,000, a $83,000 or 2.62% increase.  On  December
31, 1998, the Company's net interest margin was 3.35%.


Noninterest income consists of service charges, fees on financial
services,  and investment securities transactions.   On  December
31,  1998,  noninterest income was $625,000, a  $44,000  increase
from  previous year-end, with commissions on insurance accounting
for $15,000 of that increase.

Noninterest expense increased by $247,000, or 11.72% which is due
to  an increase in salaries and occupancy expense for 1998, which
is in direct correlation with the growth in assets.

LIQUIDITY

The  asset/liability  management primary function  is  to  assure
adequate  liquidity  and maintain an appropriate  spread  between
interest   earning  assets  and  interest  bearing   liabilities.
Liquidity  management  involves the ability  to  meet  cash  flow
requirements  of  customers  who may  be  depositors  wanting  to
withdraw  funds or borrowers needing funds to meet  their  credit
needs.   The  major  components of the Bank's  overall  liquidity
management  capabilities and financial  resources  are  (1)  core
deposits,  (2) closely managed maturity structure  of  loans  and
deposits,  (3) sale and maturity of assets (primarily investments
securities)  and,  if  necessary,  (4)  extensions   of   credit,
including  federal  funds  purchased and  securities  sold  under
repurchase   agreements.    With   the   Bank's   asset/liability
management  program,  most  loan  and  deposit  changes  can   be
anticipated  and  provided  for  without  an  adverse  impact  on
earnings.   The Bank's liquidity ratio at December 31,  1998  was
42.76%.

CAPITAL ADEQUACY

In  accordance with Regulation F, the following table  represents
the  Bank's ratios as of December 31, 1998 along with information
concerning minimum ratios that the Bank must meet in order to  be
classified   as   either   "Adequately  Capitalized"   or   "Well
Capitalized."

                                  Adequately      Well
                        Citizens  Capitalized  Capitalized
                          Bank      Minimum      Minimum
                                                          
Tier    1   Risk-Based    18.00%        4.00%        6.00%
Capital Ratio
                                                          
Total       Risk-Based    19.30%        8.00%       10.00%
Capital Ratio
                                                          
Leverage Ratio             9.70%        3.00%        5.00%

                  INDEPENDENT AUDITORS' REPORT
                                
                                
To the Board of Directors and Shareholders
  of Citizens Bancshares, Inc.

We  have  audited  the  accompanying consolidated  statements  of
financial  condition  of  Citizens  Bancshares,  Inc.   and   its
subsidiary  as  of December 31, 1998 and 1997,  and  the  related
consolidated statements of income, shareholders' equity, and cash
flows  for  the  years then ended.  These consolidated  financial
statements  are  the responsibility of the Company's  management.
Our responsibility is to express an opinion on these consolidated
financial statements based on our audits.

We  conducted  our  audits in accordance with generally  accepted
auditing  standards.  Those standards require that  we  plan  and
perform  the audits to obtain reasonable assurance about  whether
the  consolidated  financial  statements  are  free  of  material
misstatement.   An  audit includes examining, on  a  test  basis,
evidence   supporting  the  amounts  and   disclosures   in   the
consolidated  financial  statements.   An  audit  also   includes
assessing   the   accounting  principles  used  and   significant
estimates  made by management, as well as evaluating the  overall
financial  statement presentation.  We believe  that  our  audits
provide a reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to
above  present fairly, in all material respects, the consolidated
financial   position  of  Citizens  Bancshares,  Inc.   and   its
subsidiary  as of December 31, 1998 and 1997, and the results  of
their operations and their cash flows for the years then ended in
conformity with generally accepted accounting principles.


Basil M. Lee And Company


Baton Rouge, Louisiana
January 15, 1999
CITIZENS BANCSHARES, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
DECEMBER 31, 1998 AND 1997
(In thousands of dollars)

                                                1998       1997
                   Assets                                
                                                         
Cash and due from banks (Note 2)                $1,857     $1,848
Federal funds sold                               6,625      6,900
   Cash and cash equivalents                     8,482      8,748
Interest-bearing deposits with banks             5,142      4,758
Securities available for sale, at fair          26,513     25,316
values (Note 3)
Securities held to maturity, fair values of      8,125      8,329
$8,274 in 1998 and $8,399 in 1997 (Note 3)
Loans receivable, net of allowance for loan     52,119     46,051
losses of $1,001 in 1998 and $937 in 1997
(Note 4)
Accrued interest receivable                        940        960
Premises and equipment (Note 5)                  2,979      2,938
Foreclosed real estate, net of allowance of          -         14
$7 in 1997 (Note 6)
Deferred tax asset (Note 9)                         81         68
Other assets                                       743        775
                                                                 
  Total assets                                $105,124    $97,957

   Liabilities and Shareholders' Equity                  
                                                         
Liabilities                                              
  Demand deposits                            $  10,683   $  9,308
  Savings, NOW, and money-market deposits       15,351     13,261
  Time deposits $100,000 and more (Note 7)      22,674     22,397
  Other time deposits (Note 7)                  45,223     42,467
    Total deposits                              93,931     87,433
Accrued interest payable                           557        568
Accrued expenses and other liabilities             257        482
                                                                 
  Total liabilities                             94,745     88,483
                                                                 
Shareholders' equity (Note 13)                                   
   Common  stock,  $5  par  value,  300,000        575        575
shares  authorized, 115,000  shares  issued
and outstanding
  Additional paid-in capital                       825        825
  Retained earnings (Note 2)                     8,952      8,027
  Treasury stock at cost, 145 shares               (6)          -
  Accumulated other comprehensive income            33         47
                                                                 
  Total shareholders' equity                    10,379      9,474
                                                                 
 Total liabilities and shareholders' equity   $105,124    $97,957
CITIZENS BANCSHARES, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF INCOME
YEARS ENDED DECEMBER 31, 1998 AND 1997
(In thousands of dollars, except per share amounts)

                                                 1998       1997
Interest income                                            
  Loans receivable                               $4,768     $4,384
  Taxable securities                              1,601      1,909
  Tax-exempt securities                             304        267
  Federal funds sold                                498        327
  Deposits with banks                               302        238
    Total interest income                         7,473      7,125
                                                                  
Interest expense                                                  
  Deposits                                                        
    Savings, NOW, and money-market deposits         456        385
    Time deposits $100,000 and more               1,322      1,212
    Other time deposits                           2,437      2,358
  Other                                               5          -
      Total interest expense                      4,220      3,955
                                                                  
Net interest income                               3,253      3,170
Provision for loan losses (Note 4)                  103        128
                                                                  
  Net interest income after provision for loan    3,150      3,042
losses
                                                                  
Noninterest income                                                
  Service charges                                   473        442
  Insurance commissions                              97         82
  Other income                                       55         57
    Total noninterest income                        625        581
                                                                  
Noninterest expense                                               
  Salaries and employee benefits                  1,345      1,167
  Occupancy and equipment expense                   403        290
  Computer and courier                               14        126
  Stationery and supplies                            72         73
  Professional fees                                  66         64
  Other expense                                     454        387
    Total noninterest expense                     2,354      2,107
                                                                  
Income before income taxes                        1,421      1,516
Income tax expense (Note 9)                         398        422
                                                                  
Net income                                       $1,023     $1,094
                                                                  
Net income per share of common stock              $8.90    $  9.51
                                                                  
Average shares outstanding                      114,902    115,000
                                                                  
CITIZENS BANCSHARES, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY
YEARS ENDED DECEMBER 31, 1998 AND 1997
(In thousands of dollars)

                                                                
                                                   Accum-       
                                                   ulated
                       Addi-                        Other    Total
                      tional
              Common  Paid-in  Retained  Treasury  Compre-   Share-
                                                   hensive  holders'
              Stock   Capital  Earnings   Stock    Income    Equity
                                                            
Balance   at    $575     $825    $7,013      $  -      $47    $8,460
December 31,
1996
                                                                    
COMPRE-                                                             
HENSIVE
INCOME
Net   income       -        -     1,094         -        -     1,094
for 1997
                                                                    
Other compre-
hensive
income:
Unrealized                                                          
holding
gains     on
securities
arising
during 1997        -        -         -         -        -         -
TOTAL COMPRE-                                                  1,094
HENSIVE
INCOME
                                                                    
Cash               -        -      (80)         -        -      (80)
dividends  -
$0.70    per
share
                                                                    
Balance   at     575      825     8,027         -       47     9,474
December 31,
1997
                                                                    
COMPRE-                                                             
HENSIVE
INCOME
Net   income       -        -     1,023         -        -     1,023
for 1998
                                                                    
Other compre-
hensive
income:
Unrealized                                                          
holding loss
on
securities
arising
during 1998,       -        -         -         -     (14)      (14)
net  of  tax
of $7
TOTAL COMPRE-                                                  1,009
HENSIVE
INCOME
                                                                    
Purchase  of       -        -         -       (6)        -       (6)
stock
Cash               -        -      (98)         -        -      (98)
dividends  -
$0.85    per
share
                                                                    
Balance   at    $575     $825    $8,952      $(6)      $33   $10,379
December 31,
1998
CITIZENS BANCSHARES, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF CASH FLOWS
YEARS ENDED DECEMBER 31, 1998 AND 1997
(In thousands of dollars)
                                                1998       1997
                                                          
Cash flows from operating activities                      
Net income                                      $1,023     $1,094
Adjustments to reconcile net income  to  net                     
cash provided by
operating activities:                                            
Deferred income tax (benefit)                      (6)       (26)
Depreciation                                       184        101
Provision for loan losses                          103        128
Net (accretion) amortization of securities          39       (52)
(Increase)  decrease  in  accrued   interest        20       (70)
receivable
(Increase) decrease in other assets                 32      (133)
Increase   (decrease)  in  accrued  interest      (11)         28
payable
Increase (decrease) in accrued expenses  and     (225)         13
other liabilities
                                                                 
Net cash provided by operating activities        1,159      1,083
                                                                 
Cash flows from investing activities                             
Net  (increase) in interest-bearing deposits     (384)      (992)
with banks
Purchases of securities available for sale    (24,658)    (9,739)
Maturities of securities available for sale     23,021     11,038
Purchases of securities held to maturity       (3,698)    (3,446)
Maturities of securities held to maturity        4,282      5,462
Net (increase) in loans                        (6,209)    (4,388)
Sales of foreclosed real estate                     52         29
Purchases of premises and equipment              (225)    (1,796)
                                                                 
Net cash (used) by investing activities        (7,819)    (3,832)
                                                                 
Cash flows from financing activities                             
Net increase in deposits                         6,498      5,500
Purchase of treasury stock                         (6)          -
Dividends paid                                    (98)       (80)
                                                                 
Net cash provided by financing activities        6,394      5,420
                                                                 
Net  increase  (decrease) in cash  and  cash     (266)      2,671
equivalents
Cash  and  cash equivalents at beginning  of     8,748      6,077
year
                                                                 
Cash and cash equivalents at end of year        $8,482     $8,748
                                                                 
Interest paid                                   $4,231     $3,927
                                                                 
Income taxes paid                                 $389       $519
                                                                 
Foreclosed    real   estate   acquired    in       $38        $43
satisfaction of loans
(1)  Summary of Significant Accounting Policies

The  accounting  and  reporting policies of Citizens  Bancshares,
Inc.  (the  "Company") and its subsidiary are based on  generally
accepted accounting principles and conform to predominant banking
industry  practices. Citizens Bank, Ville Platte, Louisiana  (the
"Bank") is wholly owned by the Company.

(a)   Principles  of  consolidation - The consolidated  financial
  statements of the Company include the accounts of the Company and
  its  subsidiary.   All material intercompany  transactions  and
  accounts have been eliminated.

(b)   Nature  of  operations - The Bank  provides  a  variety  of
  financial services to individual and business customers through
  its  three  offices in Evangeline Parish, Louisiana,  which  is
  primarily  an  agricultural area.  The Bank's  primary  deposit
  products are checking and savings accounts and certificates  of
  deposit.   Its primary lending products are agricultural,  real
  estate and consumer loans.

(c)   Use  of estimates - The preparation of financial statements
  in  conformity  with  generally accepted accounting  principles
  requires management to make estimates and assumptions that affect
  the reported amounts of assets and liabilities and disclosure of
  contingent assets and liabilities at the date of the  financial
  statements  and the reported amounts of revenues  and  expenses
  during the reporting period.  Actual results could differ  from
  those  estimates.   Material estimates  that  are  particularly
  susceptible to significant change relate to the determination of
  the  allowance  for losses on loans and the valuation  of  real
  estate   acquired  in  connection  with  foreclosures   or   in
  satisfaction of loans.  In connection with the determination of
  the  allowances for losses on loans and foreclosed real estate,
  management   obtains  independent  appraisals  for  significant
  properties.   While  management uses available  information  to
  recognize  losses on loans and foreclosed real  estate,  future
  additions to the allowances may be necessary based on changes in
  local  economic  conditions,  which  depends  heavily  on   the
  agricultural industry.  In addition, regulatory agencies, as an
  integral part of their examination process, periodically review
  the  Bank's allowances for losses on loans and foreclosed  real
  estate.   Such  agencies  may require  the  Bank  to  recognize
  additions  to  the  allowances based on their  judgments  about
  information available to them at the time of their examination.
  Because  of these factors, it is reasonably possible  that  the
  allowances  for losses on loans and foreclosed real estate  may
  change materially in the near term.

(d)   Cash  equivalents - For the purpose of presentation in  the
  consolidated statements of cash flows, the Company considers due
  from bank accounts and federal funds sold to be cash equivalents.

(e)   Securities held to maturity - Bonds and notes for which the
  Bank has the positive intent and ability to hold to maturity are
  reported at cost, adjusted for premiums and discounts that  are
  recognized in interest income using the interest method over the
  period  to  maturity.  Declines in the fair value of individual
  securities below their cost that are other than temporary result
  in write-downs of the individual securities to their fair value.
  The  related  write-downs are included in earnings as  realized
  losses.

(f)   Securities  available for sale - Securities  available  for
  sale  consist  of  bonds and notes not classified  as  held  to
  maturity.  Unrealized holding gains and losses, net of tax,  on
  these securities are reported as accumulated other comprehensive
  income in shareholders' equity.  Gains and losses on the sale of
  securities available for sale are determined using the specific-
  identification method.  Premiums and discounts are recognized in
  interest  income using the interest method over the  period  to
  maturity.   Declines in the fair value of individual securities
  below their cost that are other than temporary result in write-
  downs  of  the individual securities to their fair value.   The
  related write-downs are included in earnings as realized losses.

(g)   Loans  receivable  and allowance for loan  losses  -  Loans
  receivable that management has the intent and ability to hold for
  the foreseeable future or until maturity or pay-off are reported
  at their outstanding principal adjusted for any charge-offs, the
  allowance for loan losses, and unearned income.  Unearned income
  on discounted loans is recognized as income over the term of the
  loans  using  a  method that approximates the interest  method.
  Interest  on  other  loans is calculated by  using  the  simple
  interest  method  on  daily balances of  the  principal  amount
  outstanding.   The  accrual of interest on  impaired  loans  is
  discontinued when, in management's opinion, the borrower may be
  unable  to  meet payments as they become due.  Interest  income
  generally is not recognized on these loans unless the likelihood
  of  further loss is remote.  Interest payments received on such
  loans are applied as a reduction of the loan principal balance.
  The allowance for loan losses is increased by charges to income
  and decreased by charge-offs (net of recoveries).  Management's
  periodic evaluation of the adequacy of the allowance is based on
  the Bank's past loan loss experience, known and inherent risks in
  the portfolio, adverse situations that may affect the borrower's
  ability  to  repay,  the  estimated  value  of  any  underlying
  collateral, and current economic conditions.

(h)   Premises  and equipment - Land is carried  at  cost.   Bank
  premises,  furniture and equipment are carried  at  cost,  less
  accumulated depreciation and amortization computed principally by
  the straight-line method.

(i)   Foreclosed  real  estate - Real estate properties  acquired
  through, or in lieu of, loan foreclosure are to be sold and are
  initially  recorded  at fair value at the date  of  foreclosure
  establishing a new cost basis.  After foreclosure, valuations are
  periodically  performed by management and the  real  estate  is
  carried at the lower of carrying amount or fair value less cost
  to sell.  Revenue and expenses from operations and changes in the
  valuation allowance are included in operations.

(j)  Fair values of financial instruments - In cases where quoted
  market prices of financial instruments are not available,  fair
  values  are  based on estimates using present  value  or  other
  valuation   techniques.   Those  techniques  are  significantly
  affected by the assumptions used, including the discount rate and
  estimates of future cash flows.  In that regard, the derived fair
  value  estimates  cannot  be  substantiated  by  comparison  to
  independent markets and, in many cases, could not be realized in
  immediate  settlement of the instruments. The  fair  values  of
  certain  financial instruments and all nonfinancial instruments
  are  not  required to be disclosed.  Accordingly, the aggregate
  fair  value  amounts presented do not represent the  underlying
  value of the Company. The following methods and assumptions were
  used  by  the  Company in estimating fair values  of  financial
  instruments:

   (1)  Cash, due from banks, federal funds sold and interest-
     bearing deposits with banks.  The carrying amount is a reasonable
     estimate of fair value.
   
   (2)  Securities.  Fair value is based on quoted market price, if
     available.  If a quoted market price is not available, fair value
     is estimated using quoted market prices for similar securities.
   
   (3)   Loans  receivable.  The fair value  is  estimated  by
     discounting the estimated future cash flows using the current
     rates at which similar loans would be made to borrowers with
     similar credit ratings and for the same remaining maturities.
   
   (4)  Deposits.  The fair value of demand, savings, NOW and money
     market accounts is the amount payable on demand at the reporting
     date.  The fair value of fixed-maturity time deposits  is
     estimated using the rates currently offered for deposits of
     similar remaining maturities.
   
   (5)  Commitments to extend credit and standby letters of credit.
     If material, the fair value is estimated using the fees currently
     charged to enter into similar agreements, taking into account the
     remaining  terms  of  the  agreements  and  the   present
     creditworthiness of the counterparties.  At December 31, 1998,
     the fair values of these instruments are not material.

(k)   Income  taxes  -  Deferred tax assets and  liabilities  are
  reflected at currently enacted income tax rates applicable to the
  period  in  which  the deferred tax assets or  liabilities  are
  expected to be realized or settled.  As changes in tax laws  or
  rates  are  enacted,  deferred tax assets and  liabilities  are
  adjusted through the provision for income taxes.

(l)   Net income per share - Net income per share of common stock
  has been computed on the basis of the weighted-average number of
  shares of common stock outstanding.

(m)  Reclassifications - Certain reclassifications have been made
  to the prior year's financial statements, which have no effect on
  net  income as previously reported, to conform to current  year
  reporting.


(2)  Restrictions

The  Bank is required to maintain average reserve balances by the
Federal Reserve Bank.  The average amounts of these reserves  for
the  years  ended  December 31, 1998 and 1997 were  $308,000  and
$266,000, respectively.

In  addition, prior approval of the Commissioner of the Louisiana
Office of Financial Institutions is required for the Bank to  pay
dividends if the total of all dividends declared and paid  during
any  one year would exceed the total of net profits of that  year
combined  with  the  net  profits from the immediately  preceding
year.


(3)  Investment Securities

The amortized costs and approximate fair values of investments
in  debt  securities at December 31 follow  (in  thousands  of
dollars):
                                     December 31, 1998
                                      Gross     Gross        
                            Amort-    Unreal-   Unreal-    Fair
                             ized      ized      ized
Securities  available  for   Cost     Gains     Losses    Value
sale
                                                          
U. S. Treasury securities   $1,304      $  8      $  -    $1,312
U.  S. Government agencies   9,391        15         7     9,399
and corporations
Mortgage-backed securities  15,770        73        41    15,802
                           $26,465       $96       $48   $26,513
                                                          
Securities     held     to                                
maturity
                                                          
States    and    political  $7,402      $147      $  -    $7,549
subdivisions
Mortgage-backed securities     723         2         -       725
                            $8,125      $149      $  -    $8,274
                                                                
Securities   pledged    to                                      
secure public deposits
and for other purposes     $13,843                       $13,933

Securities  available  for           December 31, 1997
sale
                                                          
U. S. Treasury securities   $2,211    $    3      $  4    $2,210
U.  S. Government agencies  14,457        30        13    14,474
and corporations
Mortgage-backed securities   8,578        90        36     8,632
                           $25,246      $123       $53   $25,316
                                              
Securities     held     to                                   
maturity
                                                          
U. S. Treasury securities   $1,001     $   -       $ -    $1,001
U.  S. Government agencies   1,399         -         -     1,399
and corporations
States    and    political   5,357        74         -     5,431
subdivisions
Mortgage-backed securities     572         -         4       568
                            $8,329       $74        $4    $8,399
                                                                
Securities   pledged    to                                      
secure public deposits
and for other purposes      $7,505                        $7,520

The  scheduled maturities of securities available for sale and
held  to  maturity at December 31, 1998 were  as  follows  (in
thousands of dollars):

                           Available for sale  Held to maturity
                            Amort-     Fair     Amort-     Fair
                             ized                ized
Contractual maturities       Cost     Value      Cost     Value
                                                          
One year or less            $3,133    $3,143    $  894    $  900
After   one  year  through  17,174    17,224     5,184     5,271
five years
After  five years  through   5,675     5,661     1,982     2,036
ten years
After ten years                483       485        65        67
                                                                
                           $26,465   $26,513    $8,125    $8,274

Expected  maturities  will differ from contractual  maturities
because  borrowers  may  have the  right  to  call  or  prepay
obligations  with or without call or prepayment penalties.  No
securities were sold in 1998 and 1997.


(4)  Loans Receivable

The  components  of  loans  in  the  consolidated  statements  of
financial  condition at December 31 were as follows (in thousands
of dollars):
                                         1998       1997
                                                   
Commercial                              $11,935    $10,020
Agricultural                              6,507      4,441
Real estate mortgage                     24,072     23,231
Consumer                                 11,117      9,760
Other                                        25         21
                                         53,656     47,473
Unearned income                           (536)      (485)
Allowance for loan losses               (1,001)      (937)
                                                          
                                        $52,119    $46,051

An  analysis  of  the  change in the allowance  for  loan  losses
follows (in thousands of dollars):

                                         1998      1997
                                                  
Balance at January 1                      $937      $859
                                                        
Loans charged off                         (75)      (72)
Recoveries                                  36        22
  Net loans charged off                   (39)      (50)
Provision for loan losses                  103       128
                                                        
Balance at December 31                  $1,001      $937

At  December  31,  1998  and 1997, loans  totaling  $309,000  and
$172,000  were  classified as impaired.  Of  the  total  impaired
loans at December 31, 1998 and 1997, $309,000 and $172,000 had  a
related  allowance  for  loan  losses  of  $22,000  and  $23,000,
respectively.  The average balances of these loans  in  1998  and
1997 were approximately $318,000 and $255,000.  In 1998 and 1997,
interest  income  recognized on impaired loans was  approximately
$24,000  and  $9,000,  respectively.   No  commitments  to   loan
additional  funds to borrowers of impaired loans were outstanding
at December 31, 1998.


(5)  Premises and Equipment

Components of premises and equipment included in the consolidated
statements of financial condition at December 31 were as  follows
(in thousands of dollars):
                                         1998      1997
Cost:                                             
Land                                    $  241    $  241
Buildings                                2,718     2,621
Furniture and equipment                    734       606
Automobiles                                 55        55
                                         3,748     3,523
Accumulated depreciation                 (769)     (585)
                                                        
                                        $2,979    $2,938

The Company is the lessee of computer hardware and software under
capital  leases that expire in 2000 at which time the assets  can
be  purchased  for  $1.  The assets are recorded  at  a  cost  of
$96,000.   Amortization of the cost is over  five  years  and  is
included  in  depreciation expense.  The  related  capital  lease
payable  is included in other liabilities and is being  amortized
over the lease term of three years at an average interest rate of
4.6%.  Future minimum lease payments are $40,000 per year in  the
years 1998 through 2000.


(6)  Foreclosed Real Estate

Activity in the allowance for losses on foreclosed real estate is
as follows (in thousands of dollars):

                                         1998      1997
                                                  
Balance at January 1                      $  7      $ 16
Provision charged to income                  -         -
Charge-offs, net of recoveries             (7)       (9)
Balance at December 31                    $  -      $  7


(7)  Deposits

At  December 31, 1998, the scheduled maturities of time  deposits
are as follows (in thousands of dollars):

                              $100,000    Other time
Year maturing                 and more     deposits
                                           
1999                           $19,910       $39,578
2000                             1,764         4,116
2001                             1,000         1,316
2002                                 -           213
                                                    
                               $22,674       $45,223


(8)  Financial Instruments

The  Bank  is  a party to financial instruments with  off-balance
sheet risk in the normal course of business to meet the financing
needs  of  its  customers.  These financial  instruments  include
commitments to extend credit and standby letters of credit, which
involve  credit risk in excess of the amounts recognized  in  the
statement of financial condition.  The Bank's exposure to  credit
loss  in the event of nonperformance by the other party to  these
financial  instruments is represented by the contractual  amounts
of  the  instruments.  The Bank uses the same credit policies  in
making commitments and conditional obligations as it does for on-
balance sheet instruments, including collateral or other security
to support the financial instruments.

At  December  31,  1998 and 1997, commitments  to  extend  credit
totaled   $5,917,000   and   $4,435,000,   respectively.    These
commitments are agreements to lend to a customer as long as there
is  no  violation of any condition established in  the  contract.
Commitments  generally  have  fixed  expiration  dates  or  other
termination clauses and may require payment of a fee.  Since many
of the commitments may expire without being drawn upon, the total
commitment  amounts  do  not necessarily  represent  future  cash
requirements.

At  December 31, 1998 and 1997, commitments under standby letters
of  credit totaled $267,000 and $286,000, respectively.   Standby
letters of credit are conditional commitments issued by the  Bank
to guarantee the performance of a customer to a third party.  The
credit  risk involved in issuing letters of credit is essentially
the same as that involved in extending loans to customers.

The  carrying amounts and estimated fair values of the  Company's
financial  instruments at December 31, 1998 are  as  follows  (in
thousands of dollars):
                                     
                              Carrying     Fair
                               Amount     Value
Financial assets                          
Cash and due from banks         $1,857    $1,857
Federal funds sold               6,625     6,625
Securities                      34,638    34,787
Loans receivable                52,119    52,229
                                                
Financial liabilities                           
Deposits                        93,931    94,213


(9)  Income Taxes

The  consolidated  provision for income taxes  consisted  of  the
following  for  the  years ended December  31  (in  thousands  of
dollars):

                                             1998     1997
                                                      
Current expense                               $404     $448
Deferred expense (benefit)                     (6)     (26)
                                                           
Income tax expense                            $398     $422

The  effective  tax  rates differed from  the  statutory  federal
income tax rates as follows:

                                         1998       1997
                                                   
Statutory federal income tax rate         34.0%      34.0%
Nontaxable income                        (7.9%)     (6.4%)
Nondeductible expenses                     2.1%       1.6%
Other                                    (0.2%)     (1.4%)
                                                          
Effective tax rate                        28.0%      27.8%

Deferred  tax assets and (liabilities) at December 31 consist  of
the following (in thousands of dollars):

                                             1998     1997
                                                      
Net  (appreciation) of securities available  $(17)    $(24)
for sale
Allowance for loan losses                      156      134
Allowance for foreclosed real estate losses      -        3
Accumulated depreciation                     (113)     (89)
Deferred compensation payable                   46       36
Accreted discount on investments              (16)     (17)
Tax basis over book value of land               25       25
                                                           
Deferred tax asset                             $81     $ 68

No  valuation  allowance was recorded to reduce the deferred  tax
asset at December 31, 1998 and 1997.


(10)  Related Parties

The  Bank  has  entered  into transactions  with  its  directors,
executive   officers,   significant   shareholders,   and   their
affiliates.   The  aggregate amount  of  loans  to  such  related
parties  at December 31, 1998 and 1997 was $548,000 and $602,000,
respectively.   During  1998, new loans to such  related  parties
amounted   to  $485,000  and  repayments  amounted  to  $539,000.
Deposits  held  by  the Bank at December 31, 1998  and  1997  for
related  parties  were  $2,664,000 and $2,958,000,  respectively.
Fees  paid  for  goods and services provided by  related  parties
amounted to $10,000 in 1998 and $14,000 in 1997.


(11)  Commitments

At  December  31,  1998 and 1997, the Bank had  unused  lines  of
credit  with other banks which totaled $3,000,000 and $3,750,000.
The  lines were unsecured and have variable interest rates  based
on the lending bank's daily federal funds rate.


(12)  Pension Plan

Effective  January  1, 1997, the Bank offers a Savings  Incentive
Match Plan for Employees (SIMPLE) with no minimum age or years of
service eligibility requirements.  All employees who have  earned
at  least  $5,000 during one of the two preceding calendar  years
and  are  expected  to earn at least $5,000  during  the  current
calendar  year  are  eligible to participate.   Participants  may
elect  to  defer up to $6,000 of their compensation  as  elective
contributions.    The  Bank  is  required   to   match   employee
contributions up to 3% of each employee's total compensation. The
Bank  contributions  in 1998 and 1997 were $27,000  and  $23,000,
respectively.


(13)  Regulatory Matters

The  Bank  is  subject to various regulatory capital requirements
administered  by the federal banking agencies.  Failure  to  meet
minimum capital requirements can initiate certain mandatory,  and
possibly   discretionary,  actions   by   regulators   that,   if
undertaken,  could have a direct material effect  on  the  Bank's
financial statements.  Under capital adequacy guidelines and  the
regulatory framework for prompt corrective action, the Bank  must
meet   specific  capital  guidelines  that  involve  quantitative
measures  of  the  Bank's assets, liabilities, and  certain  off-
balance  sheet  items  as calculated under regulatory  accounting
practices.   The  Bank's capital amounts and  classification  are
also  subject  to  qualitative judgments by the regulators  about
components, risk weightings, and other factors.

Quantitative measures established by regulation to ensure capital
adequacy require the Bank to maintain minimum amounts and  ratios
of  total  and Tier 1 capital, as defined in the regulations,  to
risk-weighted  assets,  as defined, and  of  Tier  1  capital  to
average  assets, as defined.  Management believes, as of December
31,  1998,  that the Bank meets all capital adequacy requirements
to which it is subject.

As  of  December 31, 1998, the most recent notification from  the
Federal  Deposit Insurance Corporation categorized  the  Bank  as
well  capitalized  under  the  regulatory  framework  for  prompt
corrective  action.  To be categorized as well  capitalized,  the
Bank  must  maintain a total risk-based capital ratio of  10%  or
higher, Tier 1 risk-based capital ratio of 6% or higher, and Tier
1  leverage  capital  ratio of 5% or higher.   No  conditions  or
events  have  occurred  since that notification  that  management
believes  have changed the Bank's category.  The following  table
presents  the  Bank's actual capital amounts  and  ratios  as  of
December 31 (dollars in thousands):

                              1998                1997
                        Amount     Ratio    Amount     Ratio
                                                       
Total Capital (to Risk  $10,760    19.3%     $9,731    19.8%
Weighted Assets)
                                                            
Tier  1  Capital   (to  $10,062    18.0%     $9,117    18.5%
Risk Weighted Assets)
                                                            
Tier  1  Capital   (to  $10,062     9.7%     $9,117     9.5%
Average Assets)


(14)  Parent Company Statements

The  financial  statements of Citizens Bancshares,  Inc.  (parent
company only) at December 31 and for the years then ended  follow
(in thousands of dollars):

Statements of Financial Condition        1998       1997
                Assets                                    
Investment in Citizens Bank, at equity  $10,375     $9,468
Cash and equivalents                          4          6
Total assets                            $10,379     $9,474
 Liabilities and Shareholders' Equity                 
Total liabilities                       $     -    $     -
                                                          
Common stock                                575        575
Additional paid-in capital                  825        825
Retained earnings                         8,952      8,027
Treasury stock                              (6)          -
Accumulated other comprehensive income       33         47
Total shareholders' equity               10,379      9,474
Total  liabilities  and  shareholders'  $10,379     $9,474
equity
Statements of Income                                  
                Income                                    
Equity in undistributed net income  of   $  921     $1,013
Citizens Bank
Dividends received from Citizens Bank       105         86
Total income                              1,026      1,099
               Expenses                                   
Other expense                                 3          5
Total expenses                                3          5
Net income                               $1,023     $1,094
                                                          
Statements of Cash Flows                                  
                                                          
Cash flows from operating activities                      
Net income                               $1,023     $1,094
Adjustments to reconcile net income to                    
net   cash   provided   by   operating
activities:
Equity in undistributed net income  of    (921)    (1,013)
Citizens Bank
Net   cash   provided   by   operating      102         81
activities
                                                          
Cash flows from investing activities          -          -
                                                          
Cash flows from financing activities                      
Purchase of treasury stock                  (6)          -
Dividends paid                             (98)       (80)
Net    cash    (used)   by   financing    (104)       (80)
activities
                                                          
Net  increase (decrease) in  cash  and      (2)          1
equivalents
Cash  and equivalents at beginning  of        6          5
year
Cash and equivalents at end of year     $     4    $     6


(15)  Bank Subsidiary Statements

The statements of financial condition and income of Citizens Bank
(bank  only)  at December 31 and for the years then ended  follow
(in thousands of dollars):

Statements of Financial Condition         1998       1997
                                                    
                Assets                                     
Cash and due from banks                   $1,857     $1,848
Federal funds sold                         6,625      6,900
Interest-bearing deposits with banks       5,142      4,758
Investment securities                     34,638     33,645
Loans receivable                          52,119     46,051
Accrued interest receivable                  940        960
Premises and equipment                     2,979      3,064
Foreclosed real estate                         -         14
Deferred tax asset                            81         68
Other assets                                 743        649
Total assets                            $105,124    $97,957
                                                           
 Liabilities and Shareholder's Equity                      
Deposits                                 $93,935    $87,440
Accrued interest payable                     557        568
Accrued expenses and other liabilities       257        481
Common stock                                 575        575
Additional paid-in capital                 4,000      4,000
Retained earnings                          5,767      4,846
Accumulated other comprehensive income        33         47
Total  liabilities  and  shareholder's  $105,124    $97,957
equity
                                                           
Statements of Income                                   
                                                           
Interest income                                            
Loans                                     $4,768     $4,384
Investment securities                      1,905      2,176
Federal funds sold                           498        327
Deposits with banks                          302        238
Total interest income                      7,473      7,125
Interest expense                           4,220      3,956
Net interest income                        3,253      3,169
Provision for loan losses                    103        128
Net  interest  income after  provision     3,150      3,041
for loan losses
                                                           
Noninterest income                           625        580
Noninterest expense                        2,351      2,101
Income tax expense                           398        422
                                                           
Net income                                $1,026     $1,098
DESCRIPTION OF BUSINESS

Citizens Bancshares, Inc. (the "Company") is a Louisiana business
corporation and a one-bank holding company registered  under  the
federal Bank Holding Company Act of 1956.  The Company was formed
in  1983  primarily  for  the  purpose  of  holding  all  of  the
outstanding stock of Citizens Bank, Ville Platte, Louisiana  (the
"Bank"), which is the Company's sole subsidiary.

The  Bank  was  formed under the banking laws  of  the  State  of
Louisiana.   The  Bank  conducts  a  general  commercial  banking
business  through its main office in Ville Platte, Louisiana  and
branch  offices in Mamou, Louisiana and Pine Prairie,  Louisiana.
The  Bank  offers a full range of traditional commercial  banking
services,  including demand, savings and time deposits, consumer,
credit  card,  and  commercial and real estate loans,  and  safe-
deposit boxes.  The Bank does not offer trust services.  Drive-in
banking facilities are located at all banking locations.

The Bank competes actively with national and state banks, savings
institutions,  and credit unions in Louisiana for  all  types  of
loans  and deposits.  The Bank also competes with other financial
institutions such as insurance companies, real estate  investment
trusts, small loan companies, and certain government agencies.

As   of  December  31,  1998,  the  Company  and  the  Bank   had
approximately 45 full-time equivalent employees.  The Company has
no  salaried employees, although certain executive officers  hold
parallel  positions with the Bank.  No employees are  represented
by unions or other bargaining units, and management considers its
relations with employees to be satisfactory.


MARKET FOR COMMON EQUITY AND RELATED SHAREHOLDER MATTERS

Citizens  Bancshares,  Inc. stock is  not  listed  on  any  stock
exchange  or  over-the-counter market.   The  transaction  prices
listed  below reflect only a limited number of transactions  that
have  come to the attention of management.  No assurance  can  be
given  that such prices represent the actual market value of  the
Company's  common stock.  At December 31, 1998,  there  were  464
holders of record of the Company's common stock.

                                   1998            1997
Per share stock transactions    High   Low      High   Low

First Quarter                   $40    $18      $18    $15
Second Quarter                  $40    $20      $20    $15
Third Quarter                   $40    $40      $40    $18
Fourth Quarter                  $40    $40      $40    $18

Dividends per share                $0.85          $0.70

AVAILABILITY OF ANNUAL REPORT ON FORM 10-KSB

The annual report of Citizens Bancshares, Inc. and subsidiary as filed with
the Securities and Exchange Commission of Form 10-KSB is available on request
to any shareholder free of charge by writing to Carl Fontenot, President,
Citizens Bancshares, Inc., Post Office Box 598, Ville Platte, Louisiana,
70586.

DIRECTORS AND EXECUTIVE OFFICERS

Directors and executive officers of the Company and its only subsidiary, 
Citizens Bank, their principal occupations and the year each of the
directors took office are as follows:

Name                             Principal Occupation

Curley Courville                 Director of the Bank since 1975, Director
                                 of the Company since 1983; Retired investor.

Carl W. Fontenot                 Director of the Bank since 1975; Director
                                 of the Company since 1983; President and
                                 CEO of the Bank and the Company.

Eugene S. Fontenot               Director of the Bank since 1975; Director
                                 and Secretary of the Company since 1983;
                                 Owner and President of Euco Finance Company,
                                 Inc.

J. Jake Fontenot                 Director of the Bank since 1975; Director 
                                 of the Company since 1983; Attorney at Law.

Otis Fontenot                    Director of the Bank since 1975; Director
                                 of the Company since 1983; Retired planter.

Fredrick Phillips                Director of the Bank since 1975; Director
                                 of the Company since 1983; Owner of F.
                                 Phillips General Contractors, Inc.

J.B. Veillon                     Director and Vice President of the Bank  
                                 since 1975; Director and Vice President of
                                 the Company since 1983; Retired retailor.

Roderick Young                   Director of the Bank since 1977; Director
                                 of the Company since 1983; Owner of R&R
                                 Auto Parts.

Jules Hebert                     Director of the Bank since 1980; Director of
                                 the Company since 1983; Owner and President
                                 of Farmers Gas Company, Inc., propane and
                                 butane gas distributor.

Wayne Vidrine                    Executive Vice President and Cashier of the
                                 Bank.  Treasurer of the Company.

Stephen P. Mayeux                Senior Vice President of the Bank.