UNITED STATES SECURITIES AND EXCHANGE COMMISSION

                              WASHINGTON, DC 20549

                                    FORM 10-K

                ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF
                       THE SECURITIES EXCHANGE ACT OF 1934
                   For the fiscal year ended December 31, 2005

                        Commission File Number: 33-90342

                             MAIN STREET TRUST, INC.
             (Exact name of registrant as specified in its charter)


     Illinois                                                37-1338484
--------------------------------                 -------------------------------
  (State or other jurisdiction                   (I.R.S. Employer Identification
of incorporation or organization)                             Number)

                 100 West University, Champaign, Illinois 61820
                 ----------------------------------------------
               (Address of principal executive offices) (Zip Code)

                                 (217) 351-6500
                                 --------------
              (Registrant's telephone number, including area code)
           Securities registered pursuant to Section 12(b) of the Act:

                                                           Name of each exchange
Title of Each Class                                         on which registered
-------------------                                       ----------------------
        None                                                      None

Securities registered pursuant to Section 12(g) of the Act:

                     Common Stock, $.01 par value per share
                                (Title of class)

Indicate by check mark if the  registrant is a well-known  seasoned  issuer,  as
defined in Rule 405 of the Securities Act. Yes [  ] No[ X ]

Indicate  by  check  mark if the  registrant  is not  required  to file  reports
pursuant to Section 13 or Section 15(d) of the Exchange Act. Yes [  ] No[ X ]

Indicate by check mark whether the Registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the  preceding 12 months (or for such  shorter  period that the  Registrant  was
required  to file  such  reports),  and  (2) has  been  subject  to such  filing
requirements for the past 90 days. Yes [ X ] No [  ]

Indicate by check mark if disclosure of delinquent  filers  pursuant to Item 405
of Regulation  S-K is not contained  herein,  and will not be contained,  to the
best of Registrant's  knowledge,  in definitive proxy or information  statements
incorporated  by  reference in Part III of this Form 10-K or any  amendments  to
this Form 10-K. [ X ]

Indicate by check mark whether the registrant is a large  accelerated  filer, an
accelerated  filer, or a  non-accelerated  filer. See definition of "accelerated
filer and large  accelerated  filer" in Rule 12b-2 of the  Exchange  Act.
Large accelerated filer [  ] Accelerated filer [ X ] Non-accelerated filer [  ]

Indicate by check mark whether the  registrant is a shell company (as defined in
Exchange Act Rule 12b-2). Yes [   ] No [ X ]

As of March 2, 2006, the Registrant had issued and outstanding 10,138,875 shares
of the Registrant's Common Stock.

The aggregate  market value of the voting and  non-voting  common equity held by
non-affiliates  of the registrant,  based on the last reported price on June 30,
2005, the last business day of the registrant's  most recently  completed second
fiscal quarter, was approximately $202,040,337*.

     *  Based on the last reported  price  ($28.75) of an actual  transaction in
        Registrant's  Common Stock on June 30, 2005,  and reports of  beneficial
        ownership filed by directors and executive officers of Registrant and by
        beneficial  owners of more than 5% of the  outstanding  shares of Common
        Stock of  Registrant;  however,  such  determination  of shares owned by
        affiliates  does not  constitute  an admission  of  affiliate  status or
        beneficial interest in shares of Registrant's Common Sock.

Documents Incorporated By Reference

Part III of Form 10-K -  Portions  of Proxy  Statement  for  annual  meeting  of
shareholders to be held May 17, 2006.


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<PAGE>



                             MAIN STREET TRUST, INC.

                             Form 10-K Annual Report

                                Table of Contents

                                     Part I

Item 1.   Description of Business.........................................    3
          A. General
          B. Business of the Company and Subsidiaries
          C. Competition
          D. Monetary Policy and Economic Conditions
          E. Supervision and Regulation
          F. Employees
          G. Internet Website

Item 1.a. Risk Factors....................................................   10
Item 1.b. Unresolved Staff Comments.......................................   14
Item 2.   Properties......................................................   14
Item 3.   Legal Proceedings...............................................   14
Item 4.   Submission of Matters to a Vote of Security Holders.............   14

                                     Part II

Item 5.   Market for Registrant's Common Equity, Related Shareholder Matters
            And Issuer Purchases of Equity Securities.....................   14
Item 6.   Selected Consolidated Financial Data............................   16
Item 7.   Management's Discussion and Analysis of
            Financial Condition and Results of Operations.................   16
Item 7a.  Quantitative and Qualitative Disclosures about Market Risk......   39
Item 8.   Financial Statements and Supplementary Data.....................   40
Item 9.   Changes in and Disagreements on Accounting and
            Financial Disclosure..........................................   71
Item 9a.  Controls and Procedures.........................................   71
Item 9b.  Other Information...............................................   73

                                    Part III

Ite- 10.  Directors and Executive Officers of the Registrant..............   73
Item 11.  Executive Compensation..........................................   73
Item 12.  Security Ownership of Certain Beneficial Owners
            and Management and Related Shareholder Matters................   74
Item 13.  Certain Relationships and Related Transactions..................   74
Item 14.  Principal Accountant Fees and Services..........................   74

                                     Part IV

Item 15.  Exhibits and Financial Statement Schedules......................   74


                                       2
<PAGE>


                                     PART I

Item 1. Description of Business


A. General

MAIN STREET TRUST,  INC. (the  "Company"),  an Illinois  corporation,  is a bank
holding  company  registered  under the Bank  Holding  Company  Act of 1956,  as
amended (the "BHCA").  The Company was  incorporated  on August 12, 1999, and is
the parent company of Main Street Bank & Trust, and FirsTech,  Inc.

On  March  23,  2000,  the  Company  acquired  all of the  outstanding  stock of
BankIllinois,   The  First  National  Bank  of  Decatur,  First  Trust  Bank  of
Shelbyville and FirsTech,  Inc.  following the merger of BankIllinois  Financial
Corporation  and First Decatur  Bancshares,  Inc. into the Company.  The merger,
which was accounted  for as a pooling of  interests,  was completed on March 23,
2000. The Company  subse1uently  merged the Company's former banking subsidiary,
First Trust Bank of Shelbyville,  into BankIllinois  effective June 19, 2002. On
November 10, 2004, the Company merged  BankIllinois  and The First National Bank
of Decatur into  BankIllinois  and renamed the bank Main Street Bank & Trust.

On April 1, 2005, the Company acquired all of the outstanding  stock of Citizens
First  Financial  Corp.  ("Citizens"),  which was the parent company of Citizens
Savings Bank, based in Bloomington, Illinois. The transaction has been accounted
for as a purchase.  The Company  merged  Citizens  Savings Bank into Main Street
Bank & Trust as of the close of business on October 7, 2005.

B. Business of the Company and Subsidiaries

General

The Company  conducts the business of banking and offers trust services  through
Main Street Bank & Trust ("the Bank"),  and retail  payment  processing  through
FirsTech,  Inc.,  its wholly  owned  subsidiaries.  As of December  31, 2005 the
Company had consolidated total assets of $1.625 billion, shareholders' equity of
$143.769  million and Wealth  Management  Group  assets under  management  on of
approximately $1.959 billion.  Substantially all of the income of the Company is
currently derived from dividends  received from the subsidiaries and income from
other  investments.  The amount of these  dividends  is directly  related to the
earnings of the subsidiaries and is subject to various regulatory  restrictions.
See "Supervision and Regulation".

Banking Segment

The Bank conducts a general  banking  business  embracing  most of the services,
both consumer and commercial,  which banks may lawfully  provide,  including the
following  principal  services:  the acceptance of deposits to demand,  savings,
time and  individual  retirement  accounts and the  servicing of such  accounts;
commercial,  consumer and real estate lending,  including  installment loans and
personal  lines of credit;  safe deposit  operations;  and  additional  services
tailored to the needs of  individual  customers,  such as the sale of traveler's
checks,  cashier's  checks and other  specialized  services.  The Company offers
personalized  financial  planning services through Raymond James, which services
include a broad spectrum of investment products, including stocks, bonds, mutual
funds  and tax  advantaged  investments.  In  addition,  the  Wealth  Management
division offers a wide range of services such as investment  management,  acting
as trustee,  serving as  guardian,  executor  or agent,  farm  management,  401K
administration and miscellaneous consulting.

Commercial   lending  at  the  Bank  covers  such   categories  as  agriculture,
manufacturing,  capital,  inventory,  construction,  real estate development and
commercial mortgages. Commercial lending, particularly loans to small and medium
sized  businesses,  accounts for a major portion of the Bank's loan  portfolios.
The  Bank's  retail  banking  division  makes  loans to  consumers  for  various
purposes, including home equity and automobile loans. The consumer mortgage loan
department,  which is part of the retail banking  division,  specializes in real
estate loans to  individuals.  The Bank also purchases  installment  obligations
from retailers,  primarily  without  recourse.

The  Bank's  principal  sources  of income  are  interest  and fees on loans and
investments  and service  fees.  Its  principal  expenses are  interest  paid on
deposits and general  operating  expenses.  The Bank's  primary  service area is
Central Illinois.

                                       3
<PAGE>

Remittance Services Segment

FirsTech,  Inc.  provides  the  following  services to  electric,  water and gas
utilities,  telecommunication  companies,  cable television firms and charitable
organizations: retail lockbox processing of payments delivered by mail on behalf
of the biller;  processing of payments delivered by customers to pay agents such
as grocery stores,  convenience stores and currency exchanges; and concentration
of payments delivered by the Automated Clearing House network,  money management
software such as Quicken and through  networks such as Visa e-Pay and Mastercard
RPS. For the years ended December 31, 2005,  2004 and 2003,  FirsTech  accounted
for $6.9 million (7%), $7.3 million (10%) and $7.3 million (10%),  respectively,
of the consolidated total revenues of the Company and accounted for $2.6 million
(9%),  $2.3  million  (10%),  and  $2.3  million  (9%),  respectively,   of  the
consolidated  income  before  income  tax  of  the  Company.  See  Note 1 to the
Consolidated Financial Statements for an analysis of segment operations.

In 2003, FirsTech introduced a new remittance processing product called Internet
Agent.  A portion of the  additional  income  generated  by the  Internet  Agent
product was  partially  offset by decreases in  mechanical  collection,  lockbox
processing and electronic  payment income.  FirsTech has continued to experience
success in the  expansion of the Internet  Agent  product among new and existing
customers, and management believes it is at the forefront of technology compared
to similar products within the payment industry.

Over the past three years,  FirsTech's sources of processing revenue has shifted
toward the  processing of payments to paying agents.  FirsTech's  retail lockbox
processing  for  organizations  provided  approximately  20%, 30% and 41% of the
total  revenue  of  FirsTech  in 2005,  2004 and  2003,  respectively.  FirsTech
processes  payments  delivered by customers to pay agents.  Many  businesses and
merchants such as grocery stores and convenience  stores located  throughout the
United States serve as agents of utilities in collecting  customer payments.  In
2005,  2004 and 2003, the  remittance  collection  business for these  companies
accounted for approximately 79%, 69% and 55%, respectively, of the total revenue
of FirsTech.

FirsTech competes in the retail payment processing  business with companies that
range from large national  companies to small,  local  businesses.  In addition,
many companies do their own  remittance  processing  rather than  out-source the
work to an  independent  processor  such as FirsTech.  The principal  methods of
competition in the remittance  processing industry are pricing of services,  use
of technology and quality of service.

C. Competition

The Company faces strong competition both in originating loans and in attracting
deposits.  Competition  in  originating  real estate loans comes  primarily from
other commercial banks,  savings  institutions and mortgage bankers making loans
secured by real estate located in the Company's  market area.  Commercial  banks
and finance  companies,  including  finance  company  affiliates  of  automobile
manufacturers,  provide vigorous competition in consumer lending. In addition to
competition  from the local  market,  the Company faces  competition  from large
national organizations, such as financial organizations and insurance companies,
for large commercial real estate loans. The Company competes for real estate and
other  loans  primarily  on the  basis of the  interest  rates  and loan fees it
charges,  the  types of loans it  originates  and the  quality  of  services  it
provides to borrowers.

The Company faces  substantial  competition  in  attracting  deposits from other
commercial banks,  savings  institutions,  money market and mutual funds, credit
unions, insurance agencies,  brokerage firms, and other investment vehicles. The
ability of the Company to attract and retain deposits  depends on its ability to
provide  investment  opportunities that satisfy the requirements of investors as
to rate of return,  liquidity,  risk and other factors.  The Company  attracts a
significant  amount of deposits  through its branch offices,  primarily from the
communities  in which those branch offices are located;  therefore,  competition
for  those  deposits  is  principally  from  other  commercial  banks,   savings
institutions,  and credit unions  located in the same  communities.  The Company
competes  for these  deposits  by  offering  a variety of  deposit  accounts  at
competitive rates,  convenient business hours,  internet banking, and convenient
branch  locations with  interbranch  deposit and withdrawal  privileges at each.

Under the  Gramm-Leach-Bliley  Act, which was enacted in 2000,  securities firms
and insurance  companies that elect to become  financial  holding  companies may
acquire banks and other financial institutions. Although the Company has seen no
significant  impact  from  this  change,  it has the  potential  to  change  the
competitive  environment in which the Company and the Bank conduct business. The
financial services industry is also likely to become more competitive as further
technological  advances  enable more  companies to provide  financial  services.
These   technological   advances  may  diminish  the  importance  of  depository
institutions and other financial intermediaries in the transfer of funds between
parties.

                                       4
<PAGE>

D. Monetary Policy and Economic Conditions

The earnings of  commercial  banks and bank holding  companies  are affected not
only by  general  economic  conditions,  but  also by the  policies  of  various
governmental  regulatory agencies. In particular,  the Federal Reserve regulates
money and credit  conditions  and interest  rates in order to influence  general
economic conditions and interest rates, primarily through open market operations
in U.S.  government  securities,  varying the discount  rate on member banks and
nonmember  bank  borrowings  and  setting  reserve   requirements  against  bank
deposits. Such Federal Reserve policies and acts have a significant influence on
overall growth and distribution of bank loans, investments, deposits and related
interest rates. The Company cannot  accurately  predict the effect, if any, such
policies and acts may have in the future on its business or earnings.

E. Supervision and Regulation

General

Financial  institutions,  their  holding  companies  and  their  affiliates  are
extensively  regulated under federal and state law. As a result,  the growth and
earnings  performance  of the  Company may be  affected  not only by  management
decisions  and general  economic  conditions,  but also by the  requirements  of
federal and state statutes and by the  regulations  and policies of various bank
regulatory  authorities,  including  the Illinois  Department  of Financial  and
Professional  Regulation  (the  "DFPR"),  the Board of  Governors of the Federal
Reserve  System  (the  "Federal  Reserve")  and the  Federal  Deposit  Insurance
Corporation  (the  "FDIC").  Furthermore,  taxation  laws  administered  by  the
Internal  Revenue  Service and state  taxing  authorities  and  securities  laws
administered  by the  Securities and Exchange  Commission  (the "SEC") and state
securities authorities have an impact on the business of the Company. The effect
of these statutes,  regulations and regulatory policies may be significant,  and
cannot be predicted with a high degree of certainty.

Federal  and  state  laws and  regulations  generally  applicable  to  financial
institutions regulate,  among other things, the scope of business, the kinds and
amounts  of  investments,  reserve  requirements,  capital  levels  relative  to
operations,  the nature and amount of collateral for loans, the establishment of
branches,  mergers and consolidations and the payment of dividends.  This system
of supervision  and  regulation  establishes a  comprehensive  framework for the
respective  operations  of the  Company  and its  subsidiaries  and is  intended
primarily for the protection of the FDIC-insured  deposits and depositors of the
Bank, rather than shareholders.

The following is a summary of the material elements of the regulatory  framework
that  applies to the Company and its  subsidiaries.  It does not describe all of
the  statutes,  regulations  and  regulatory  policies  that apply,  nor does it
restate  all of the  requirements  of those  that are  described.  As such,  the
following is qualified  in its  entirety by  reference  to  applicable  law. Any
change in  statutes,  regulations  or  regulatory  policies  may have a material
effect on the business of the Company and its subsidiaries.

The Company

General.  The Company,  as the sole  shareholder  of the Bank, is a bank holding
company.  As a bank holding  company,  the Company is  registered  with,  and is
subject to regulation by, the Federal Reserve under the Bank Holding Company Act
of 1956, as amended (the "BHCA"). In accordance with Federal Reserve policy, the
Company is expected to act as a source of financial  strength to the Bank and to
commit  resources to support the Bank in  circumstances  where the Company might
not  otherwise  do so.  Under the BHCA,  the  Company  is  subject  to  periodic
examination  by the Federal  Reserve.  The Company is also required to file with
the  Federal  Reserve  periodic  reports of the  Company's  operations  and such
additional information regarding the Company and its subsidiaries as the Federal
Reserve may require.

Acquisitions,  Activities and Change in Control.  The primary  purpose of a bank
holding company is to control and manage banks. The BHCA generally  requires the
prior  approval of the Federal  Reserve for any merger  involving a bank holding
company or any  acquisition  by a bank  holding  company of another bank or bank
holding company.  Subject to certain conditions (including deposit concentration
limits  established by the BHCA),  the Federal  Reserve may allow a bank holding
company to acquire banks located in any state of the United States. In approving
interstate  acquisitions,  the  Federal  Reserve is  required  to give effect to
applicable state law limitations on the aggregate amount of deposits that may be
held  by  the  acquiring  bank  holding  company  and  its  insured   depository
institution  affiliates  in the  state  in  which  the  target  bank is  located
(provided that those limits do not discriminate against out-of-state  depository
institutions  or their holding  companies)  and state laws that require that the
target bank have been in existence  for a minimum  period of time (not to exceed
five years) before being acquired by an out-of-state bank holding company.

                                       5
<PAGE>

The BHCA generally  prohibits a bank holding  company from  acquiring  direct or
indirect  ownership  or  control  of more  than 5% of the  voting  shares of any
company that is not a bank and from engaging in any business  other than that of
banking,  managing and  controlling  banks or  furnishing  services to banks and
their  subsidiaries.  This  general  prohibition  is  subject  to  a  number  of
exceptions.  The principal exception allows bank holding companies to engage in,
and to own shares of  companies  engaged  in,  certain  businesses  found by the
Federal  Reserve  to be "so  closely  related  to  banking...  as to be a proper
incident  thereto."  This  authority  would  permit  the  Company to engage in a
variety of  banking-related  businesses,  including  the  operation of a thrift,
consumer finance,  equipment leasing, the operation of a computer service bureau
(including software development),  and mortgage banking and brokerage.  The BHCA
generally does not place territorial  restrictions on the domestic activities of
non-bank subsidiaries of bank holding companies.

Additionally,  bank holding companies that meet certain eligibility requirements
prescribed by the BHCA and elect to operate as financial  holding  companies may
engage in, or own shares in  companies  engaged in, a wider range of  nonbanking
activities,  including securities and insurance underwriting and sales, merchant
banking and any other activity that the Federal  Reserve,  in consultation  with
the Secretary of the Treasury, determines by regulation or order is financial in
nature,  incidental to any such financial  activity or complementary to any such
financial  activity  and does  not  pose a  substantial  risk to the  safety  or
soundness of depository  institutions  or the financial  system  generally.  The
Company  has  elected  (and the  Federal  Reserve  has  accepted  the  Company's
election) to operate as a financial holding company.

Federal law also prohibits any person or company from acquiring  "control" of an
FDIC-insured  depository institution or its holding company without prior notice
to the appropriate federal bank regulator. "Control" is conclusively presumed to
exist upon the acquisition of 25% or more of the outstanding  voting  securities
of a bank or bank holding company, but may arise under certain  circumstances at
10% ownership.

Capital  Requirements.  Bank holding  companies are required to maintain minimum
levels  of  capital  in  accordance  with  Federal   Reserve  capital   adequacy
guidelines.  If capital levels fall below the minimum  required  levels,  a bank
holding  company,  among  other  things,  may be denied  approval  to acquire or
establish additional banks or non-bank businesses.

The  Federal  Reserve's  capital  guidelines  establish  the  following  minimum
regulatory  capital  requirements for bank holding  companies:  (i) a risk-based
requirement  expressed as a percentage  of total  assets  weighted  according to
risk; and (ii) a leverage requirement expressed as a percentage of total assets.
The risk-based requirement consists of a minimum ratio of total capital to total
risk-weighted  assets  of 8% and a  minimum  ratio  of Tier 1  capital  to total
risk-weighted assets of 4%. The leverage requirement consists of a minimum ratio
of Tier 1 capital to total  assets of 3% for the most  highly  rated  companies,
with a minimum  requirement of 4% for all others.  For purposes of these capital
standards,  Tier 1 capital consists primarily of permanent  stockholders' equity
less intangible  assets (other than certain loan servicing  rights and purchased
credit card  relationships).  Total capital consists primarily of Tier 1 capital
plus  certain  other debt and equity  instruments  that do not qualify as Tier 1
capital and a portion of the company's allowance for loan and lease losses.

The risk-based and leverage standards described above are minimum  requirements.
Higher   capital  levels  will  be  required  if  warranted  by  the  particular
circumstances or risk profiles of individual banking organizations. For example,
the Federal Reserve's capital guidelines contemplate that additional capital may
be required to take adequate account of, among other things, interest rate risk,
or the risks posed by  concentrations  of credit,  nontraditional  activities or
securities trading activities. Further, any banking organization experiencing or
anticipating  significant  growth would be expected to maintain  capital ratios,
including  tangible capital  positions (i.e., Tier 1 capital less all intangible
assets), well above the minimum levels. As of December 31, 2005, the Company had
regulatory capital in excess of the Federal Reserve's minimum requirements.

Dividend  Payments.  The Company's  ability to pay dividends to its shareholders
may be affected by both general corporate law considerations and policies of the
Federal  Reserve   applicable  to  bank  holding   companies.   As  an  Illinois
corporation,  the Company is subject to the limitations of the Illinois Business
Corporation  Act, as amended,  which prohibit the Company from paying a dividend
if, after giving effect to the dividend: (i) the Company would be insolvent;  or
(ii) the net assets of the  Company  would be less than  zero;  or (iii) the net
assets of the  Company  would be less than the maximum  amount  then  payable to
shareholders of the company who would have preferential  distribution  rights if
the Company  were  liquidated.  Additionally,  policies  of the Federal  Reserve
caution that a bank holding  company  should not pay cash  dividends that exceed
its net income or that can only be funded in ways that  weaken the bank  holding
company's  financial  health,  such as by  borrowing.  The Federal  Reserve also
possesses  enforcement  powers over bank holding  companies  and their  non-bank
subsidiaries  to  prevent or remedy  actions  that  represent  unsafe or unsound
practices or  violations  of applicable  statutes and  regulations.  Among these
powers is the ability to  proscribe  the payment of  dividends by banks and bank
holding companies.

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<PAGE>

Federal Securities Regulation. The Company's common stock is registered with the
SEC under the  Securities Act of 1933, as amended,  and the Securities  Exchange
Act of 1934,  as amended  (the  "Exchange  Act").  Consequently,  the Company is
subject  to the  information,  proxy  solicitation,  insider  trading  and other
restrictions and requirements of the SEC under the Exchange Act.

The Bank

General. The Bank is an  Illinois-chartered  bank, the deposit accounts of which
are insured by the FDIC's Bank Insurance Fund ("BIF"). As an  Illinois-chartered
FDIC-insured  bank,  the  Bank  is  subject  to  the  examination,  supervision,
reporting and enforcement requirements of the DFPR, the chartering authority for
Illinois Banks,  and the FDIC,  designated by federal law as the primary federal
regulator  of insured  state banks that,  like the Bank,  are not members of the
Federal Reserve System ("non-member banks'). The Bank is a member of the Federal
Home Loan Bank System,  which provides a central credit  facility  primarily for
member institutions.

Deposit Insurance. As an FDIC-insured  institution,  the Bank is required to pay
deposit  insurance  premium  assessments  to the  FDIC.  The FDIC has  adopted a
risk-based assessment system under which all insured depository institutions are
placed into one of nine  categories and assessed  insurance  premiums based upon
their  respective  levels of capital  and  results of  supervisory  evaluations.
Institutions  classified  as  well-capitalized  (as  defined  by the  FDIC)  and
considered  healthy pay the lowest premium while institutions that are less than
adequately  capitalized  (as defined by the FDIC) and  considered of substantial
supervisory concern pay the highest premium.  Risk classification of all insured
institutions is made by the FDIC for each semi-annual assessment period.

During the year ended  December  31,  2005,  BIF  assessments  ranged from 0% of
deposits to 0.27% of deposits.  For the semi-annual  assessment period beginning
January 1, 2006, BIF assessment rates will continue to range from 0% of deposits
to 0.27% of deposits.

FICO  Assessments.  Since 1987, a portion of the deposit  insurance  assessments
paid by members of the FDIC's  Savings  Association  Insurance Fund ("SAIF") has
been used to cover interest  payments due on the outstanding  obligations of the
Financing  Corporation  ("FICO").  FICO  was  created  in  1987 to  finance  the
recapitalization  of the Federal  Savings and Loan  Insurance  Corporation,  the
SAIF's predecessor insurance fund. As a result of federal legislation enacted in
1996,  beginning as of January 1, 1997, both SAIF members and BIF members became
subject to  assessments  to cover the  interest  payments  on  outstanding  FICO
obligations  until the final maturity of such  obligations  in 2019.  These FICO
assessments  are in  addition  to  amounts  assessed  by the  FDIC  for  deposit
insurance. During the year ended December 31, 2005, the FICO assessment rate for
BIF and SAIF members was approximately 0.01% of deposits.

Supervisory  Assessments.  All Illinois  banks are  required to pay  supervisory
assessments  to the DFPR to fund its  operations.  The amount of the  assessment
paid  by an  Illinois  bank  to the  DFPR  is  calculated  on the  basis  of the
institution's total assets, including consolidated subsidiaries,  as reported to
the DFPR.  During the year ended  December 31, 2005,  the Bank paid  supervisory
assessments to the DFPR totaling $188,000.

Capital Requirements. Banks are generally required to maintain capital levels in
excess of other  businesses.  The FDIC has  established  the  following  minimum
capital  standards for insured state non-member  banks,  such as the Bank: (i) a
leverage  requirement  consisting  of a minimum ratio of Tier 1 capital to total
assets of 3% for the most  highly-rated  banks with a minimum  requirement of at
least 4% for all others; and (ii) a risk-based capital requirement consisting of
a  minimum  ratio of total  capital  to total  risk-weighted  assets of 8% and a
minimum ratio of Tier 1 capital to total risk-weighted assets of 4%. In general,
the  components  of Tier 1 capital  and total  capital are the same as those for
bank holding companies discussed above.

The  capital  requirements  described  above are  minimum  requirements.  Higher
capital levels will be required if warranted by the particular  circumstances or
risk profiles of individual institutions.  For example,  regulations of the FDIC
provide that  additional  capital may be required to take  adequate  account of,
among other things,  interest rate risk or the risks posed by  concentrations of
credit, nontraditional activities or securities trading activities.

Further,  federal law and regulations  provide various  incentives for financial
institutions  to  maintain  regulatory  capital  at levels in excess of  minimum
regulatory   requirements.   For  example,  a  financial   institution  that  is
"well-capitalized"  may qualify for exemptions  from prior notice or application
requirements otherwise applicable to certain types of activities and may qualify
for  expedited   processing   of  other   required   notices  or   applications.
Additionally,  one of the criteria  that  determines  a bank  holding  company's
eligibility to operate as a financial  holding company is a requirement that all
of its  financial  institution  subsidiaries  be  "well-capitalized".  Under the
regulations  of  the  FDIC,  in  order  to be  "well-capitalized",  a  financial
institution must maintain a ratio of total capital to total risk-weighted assets
of 10% or greater, a ratio of Tier 1 capital to total risk-weighted assets of 6%
or greater and a ratio of Tier 1 capital to total assets of 5% or greater.

                                       7
<PAGE>

Federal law also  provides the federal  banking  regulators  with broad power to
take  prompt  corrective  action to resolve  the  problems  of  undercapitalized
institutions.  The extent of the  regulators'  powers  depends  on  whether  the
institution  in  question  is  "adequately   capitalized",   "undercapitalized",
"significantly undercapitalized", or "critically undercapitalized", in each case
as  defined by  regulation.  Depending  upon the  capital  category  to which an
institution  is  assigned,   the  regulators'  corrective  powers  include:  (i)
requiring the  institution to submit a capital  restoration  plan; (ii) limiting
the institution's  asset growth and restricting its activities;  (iii) requiring
the institution to issue additional  capital stock (including  additional voting
stock) or to be acquired; (iv) restricting  transactions between the institution
and its affiliates; (v) restricting the interest rate the institution may pay on
deposits;  (vi) ordering a new election of directors of the  institution;  (vii)
requiring  that senior  executive  officers or  directors be  dismissed;  (viii)
prohibiting the institution from accepting  deposits from  correspondent  banks;
(ix) requiring the institution to divest certain  subsidiaries;  (x) prohibiting
the payment of principal or interest on subordinated  debt; and (xi) ultimately,
appointing a receiver for the institution.

As of December  31, 2005:  (i) the Bank was not subject to a directive  from the
FDIC to increase  its  capital to an amount in excess of the minimum  regulatory
capital  requirements;  (ii) the Bank  exceeded its minimum  regulatory  capital
requirements  under FDIC  capital  adequacy  guidelines;  and (iii) the Bank was
"well-capitalized", as defined by applicable regulations.

Dividend Payments. The primary source of funds for t(e Company is dividends from
the  Bank.  Under the  Illinois  Banking  Act,  the Bank  generally  may not pay
dividends in excess of its net profits.

The payment of dividends by any financial  institution or its holding company is
affected by the requirement to maintain  adequate capital pursuant to applicable
capital  adequacy  guidelines  and  regulations,  and  a  financial  institution
generally is prohibited from paying any dividends if, following payment thereof,
the institution would be undercapitalized. As described above, the Bank exceeded
its minimum capital requirements under applicable  guidelines as of December 31,
2005. As of December 31, 2005, approximately $51.826 million was available to be
paid as dividends by the Bank.  Notwithstanding  the  availability  of funds for
dividends,  however,  the FDIC may  prohibit  the  payment  of  dividends  if it
determines such payment would constitute an unsafe or unsound practice.

Insider  Transactions.  The Bank is subject to certain  restrictions  imposed by
federal law on  extensions  of credit to the Company  and its  subsidiaries,  on
investments in the stock or other securities of the Company and its subsidiaries
and the  acceptance  of the  stock or other  securities  of the  Company  or its
subsidiaries as collateral for loans made by the Bank.  Certain  limitations and
reporting  requirements  are also placed on  extensions of credit by the Bank to
its  directors  and  officers,  to directors and officers of the Company and its
subsidiaries,   to  principal  shareholders  of  the  Company  and  to  "related
interests" of such directors,  officers and principal shareholders. In addition,
federal law and  regulations may affect the terms upon which any person who is a
director  or officer of the  Company or one of its  subsidiaries  or a principal
shareholder  of the  Company  may obtain  credit  from banks with which the Bank
maintains correspondent relationships.

Safety and  Soundness  Standards.  The federal  banking  agencies  have  adopted
guidelines that establish  operational  and managerial  standards to promote the
safety  and  soundness  of  federally  insured  depository   institutions.   The
guidelines  set forth  standards  for internal  controls,  information  systems,
internal audit systems, loan documentation,  credit underwriting,  interest rate
exposure,  asset  growth,  compensation,  fees and  benefits,  asset quality and
earnings.

In  general,  the  safety and  soundness  guidelines  prescribe  the goals to be
achieved in each area, and each  institution is responsible for establishing its
own procedures to achieve those goals.  If an  institution  fails to comply with
any of the  standards set forth in the  guidelines,  the  institution's  primary
federal regulator may require the institution to submit a plan for achieving and
maintaining  compliance.  If  an  institution  fails  to  submit  an  acceptable
compliance plan, or fails in any material respect to implement a compliance plan
that has been  accepted by its  primary  federal  regulator,  the  regulator  is
required to issue an order  directing the  institution  to cure the  deficiency.
Until the deficiency cited in the regulator's  order is cured, the regulator may
restrict the institution's  rate of growth,  require the institution to increase
its capital,  restrict the rates the institution pays on deposits or require the
institution  to take any  action  the  regulator  deems  appropriate  under  the
circumstances.  Noncompliance  with the standards  established by the safety and
soundness guidelines may also constitute grounds for other enforcement action by
the federal  banking  regulators,  including  cease and desist  orders and civil
money penalty assessments.

Branching  Authority.  Illinois  banks have the authority  under Illinois law to
establish branches anywhere in the State of Illinois,  subject to receipt of all
required regulatory approvals.

                                       8
<PAGE>

Federal law permits state and national banks to merge with banks in other states
subject  to:  (i)   regulatory   approval;   (ii)  federal  and  state   deposit
concentration limits; and (iii) state law limitations requiring the merging bank
to have  been in  existence  for a minimum  period  of time (not to exceed  five
years) prior to the merger. The establishment of new interstate  branches or the
acquisition  of individual  branches of a bank in another state (rather than the
acquisition of an out-of-state  bank in its entirety) is permitted only in those
states the laws of which expressly authorize such expansion.

State Bank  Investments and Activities.  The Bank generally is permitted to make
investments  and  engage in  activities  directly  or  through  subsidiaries  as
authorized by Illi.ois  law.  However,  under federal law and FDIC  regulations,
FDIC-insured  state banks are prohibited,  subject to certain  exceptions,  from
making or retaining equity investments of a type, or in an amount,  that are not
permissible for a national bank.  Federal law and FDIC regulations also prohibit
FDIC-insured state banks and their subsidiaries,  subject to certain exceptions,
from  engaging as principal in any activity that is not permitted for a national
bank unless the bank  meets,  and  continues  to meet,  its  minimum  regulatory
capital  requirements  and the FDIC  determines  the  activity  would not pose a
significant  risk to the deposit  insurance  fund of which the bank is a member.
These  restrictions  have not had,  and are not  currently  expected to have,  a
material impact on the operations of the Bank.

Federal Reserve System.  Federal  Reserve  regulations,  as presently in effect,
require  depository  institutions  to  maintain  non-interest  earning  reserves
against  their  transactions   accounts  (primarily  NOW  and  regular  checking
accounts),  as follows:  for transaction  accounts  aggregating $48.3 million or
less,  the reserve  requirement  is 3% of total  transaction  accounts;  and for
transaction  accounts  aggregating  in  excess  of $48.3  million,  the  reserve
requirement  is  $1.215  million  plus  10% of the  aggregate  amount  of  total
transaction  accounts  in excess of $48.3  million.  The first  $7.8  million of
otherwise reservable balances are exempted from the reserve requirements.  These
reserve  requirements  are subject to annual  adjustment by the Federal Reserve.
The Bank is in compliance with the foregoing requirements.

Recent Regulatory  Developments.  On February 8, 2006, President Bush signed the
Federal Deposit  Insurance  Reform Act of 2005 ("FDIRA") into law as part of the
Deficit Reduction Act of 2005. On February 15, 2006,  President Bush signed into
law the technical and conforming  amendments  designed to implement FDIRA. FDIRA
provides for  legislative  reforms to modernize  the federal  deposit  insurance
system.

Among other  things,  FDIRA:  (i) merges the BIF and the SAIF of the FDIC into a
new Deposit  Insurance Fund (the "DIF");  (ii) allows the FDIC,  after March 31,
2010, to increase deposit insurance  coverage by an adjustment for inflation and
requires the FDIC's Board of  Directors,  not later than April 1, 2010 and every
five years thereafter, to consider whether such an increase is warranted;  (iii)
increases the deposit insurance limit for certain employee benefit plan deposits
from $100,000 to $250,000,  subject to adjustments for inflation after March 31,
2010, and provides for pass-through  insurance coverage for such deposits;  (iv)
increases the deposit  insurance limit for certain  retirement  account deposits
from $100,000 to $250,000,  subject to adjustments for inflation after March 31,
2010; (v) allows the FDIC's Board of Directors to set deposit  insurance premium
assessments in any amount the Board of Directors deems necessary or appropriate,
after taking into account various factors  specified in FDIRA; (vi) replaces the
fixed  designated  reserve  ratio  of  1.25%  with  a  reserve  ratio  range  of
1.15%-1.50%,  with the specific  reserve ratio to be determined  annually by the
FDIC by regulation;  (vii) permits the FDIC to revise the risk-based  assessment
system by regulation;  (viii) requires the FDIC, at the end of any year in which
the reserve ratio of the DIF exceeds  1.50% of estimated  insured  deposits,  to
declare a dividend payable to insured depository institutions in an amount equal
to 100% of the  amount  held by the DIF in excess  of the  amount  necessary  to
maintain the DIF's  reserve ratio at 1.50% of estimated  insured  deposits or to
declare a dividend equal to 50% of the amount in excess of the amount  necessary
to  maintain  the  reserve  ratio  at  1.35% if the  reserve  ratio  is  between
1.35%-1.50% of estimated insured  deposits;  and (ix) provides a one-time credit
based upon the assessment  base of the  institution on December 31, 1996 to each
insured depository institution that was in existence as of December 31, 1996 and
paid a deposit  insurance  assessment  prior to that date (or a successor to any
such institution).

The merger of the BIF and the SAIF will take  effect no later than July 1, 2006,
while the remaining  provisions  are not  effective  until the FDIC issues final
regulations.  FDIRA  requires the FDIC to issue final  regulations no later than
270 days after  enactment:  (i) designating a reserve ratio;  (ii)  implementing
increases  in  deposit  insurance  coverage;  (iii)  implementing  the  dividend
requirement; (iv) implementing the one-time assessment credit; and (v) providing
for assessments in accordance with FDIRA.

                                       9
<PAGE>

F. Employees

The Company had a total of 499 employees at December 31, 2005, consisting of 399
full-time  employees and 100  part-time.  The Company  places a high priority on
staff development, which involves extensive training, including customer service
training.  New employees are selected on the basis of both technical  skills and
consumer service capabilities.  None of the Company's employees are covered by a
collective  bargaining  agreement  with the  Company  or its  subsidiaries.  The
Company  offers a variety of employee  benefits,  and  management  considers its
employee relations to be good.

G. Internet Website

The  Company   maintains   an  internet   site  for  its   subsidiary   bank  at
www.mainstreettrust.com.  The Company  makes  available  free of charge on these
sites its annual report on Form 10-K,  quarterly  reports on Form 10-Q,  current
reports on Form 8-K and other  reports  filed or  furnished  pursuant to Section
13(a) or 15(d) of the Exchange Act as soon as  reasonably  practicable  after it
electronically  files such material with, or furnishes it to, the Securities and
Exchange Commission.

Item 1.a. Risk Factors

In  addition  to the other  information  in this  Annual  Report  on Form  10-K,
shareholders or prospective  investors should  carefully  consider the following
risk factors:

Our business is  concentrated  in and dependent  upon the  continued  growth and
welfare of central Illinois:

We operate primarily in central Illinois, with branch locations in eight central
Illinois communities, including our headquarters located in Champaign, Illinois.
As a result, our financial  condition,  results of operations and cash flows are
subject to changes  in the  economic  conditions  in  central  Illinois  and our
success depends upon the business activity,  population, income levels, deposits
and real estate  activity in this area.  Although  our  customers'  business and
financial  interests may extend well beyond central  Illinois,  adverse economic
conditions  that  affect  this area could  reduce our  growth  rate,  affect the
ability of our customers to repay their loans and generally affect our financial
condition and results of operations. Because of our geographic concentration, we
are less  able  than  other  regional  or  national  financial  institutions  to
diversify our credit risks across multiple markets.

We may experience  difficulties  in managing our growth and our growth  strategy
involves risks that may negatively impact our net income:

As part of our general  strategy,  we may acquire  banks and related  businesses
that we believe provide a strategic fit with our business. To the extent that we
grow  through  acquisitions,  we  cannot  assure  you  that  we  will be able to
adequately  and  profitably  manage  this  growth.  Acquiring  other  banks  and
businesses will involve risks commonly associated with acquisitions, including:

     o    potential  exposure to unknown or contingent  liabilities of banks and
          businesses we acquire;

     o    exposure to potential  asset  quality  issues of the acquired  bank or
          related business;

     o    difficulty and expense of integrating  the operations and personnel of
          banks and businesses we acquire;

     o    potential disruption to our business;

     o    potential diversion of our management's time and attention; and

     o    the  possible  loss of key  employees  and  customers of the banks and
          businesses we acquire.

In  addition  to  acquisitions,  we may expand into  additional  communities  or
attempt to strengthen our position in our current markets by undertaking de novo
bank formations or branch openings. Generally, it may take several years for new
banking facilities to first achieve operational profitability, due to the impact
of organization and overhead expenses and the start-up phase of generating loans
and  deposits.  To the extent that we undertake  branching  and de novo bank and
business  formations,  we are likely to  continue to  experience  the effects of
higher operating  expenses relative to operating income from the new operations,
which may have an adverse effect on our levels of reported net income, return on
average equity and return on average assets.

                                       10
<PAGE>

Our continued pace of growth may require us to raise  additional  capital in the
future, but that capital may not be available when it is needed:

We are required by federal and state regulatory authorities to maintain adequate
levels of capital to support our  operations.  We  anticipate  that our existing
capital  resources  will satisfy our capital  requirements  for the  foreseeable
future.  However,  we may at some  point  need to raise  additional  capital  to
support continued growth, both internally and through acquisitions.  Our ability
to raise additional capital, if needed, will depend on conditions in the capital
markets  at that time,  which are  outside  our  control,  and on our  financial
performance.  Accordingly,  we  cannot  assure  you  of  our  ability  to  raise
additional  capital  if needed  on terms  acceptable  to us. If we cannot  raise
additional  capita, when needed,  our ability to further  expand our  operations
through internal growth and acquisitions could be materially impaired.

We face intense competition in all phases of our business from other banks and
financial institutions:

As  described  in the  business  section  of this Form  10-K,  the  banking  and
financial services business in our market is highly competitive. Our competitors
include  large  regional  banks,   local  community  banks,   savings  and  loan
associations,  securities and brokerage companies, mortgage companies, insurance
companies, finance companies, money market mutual funds, credit unions and other
non-bank  financial service providers.  Increased  competition in our market may
result in a decrease in the amounts of our loans and deposits,  reduced  spreads
between  loan rates and deposit  rates or loan terms that are more  favorable to
the borrower.  Any of these results could have a material  adverse effect on our
ability to grow and remain  profitable.  If increased  competition  causes us to
significantly  discount  the  interest  rates we offer on loans or increase  the
amount we pay on deposits,  our net interest income could be adversely impacted.
If increased competition causes us to relax our underwriting standards, we could
be exposed to higher losses from lending activities.  Additionally,  many of our
competitors  are much larger in total  assets and  capitalization,  have greater
access to capital  markets and offer a broader range of financial  services than
we can offer.

Interest rates and other conditions impact our results of operations:

Our profitability is in part a function of the spread between the interest rates
earned on  investments  and loans and the  interest  rates paid on deposits  and
other  interest-bearing  liabilities.  Like most banking  institutions,  our net
interest spread and margin will be affected by general  economic  conditions and
other factors, including fiscal and monetary policies of the federal government,
that  influence  market  interest rates and our ability to respond to changes in
such rates. At any given time, our assets and liabilities will be such that they
are affected  differently by a given change in interest rates.  As a result,  an
increase or decrease in rates, the length of loan terms or the mix of adjustable
and fixed rate loans in our portfolio  could have a positive or negative  effect
on our net income,  capital and liquidity.  We measure  interest rate risk under
various rate scenarios and using specific criteria and assumptions. A summary of
this process is presented under "Interest Rate Sensitivity"  included under Item
7 of Part II of this  Form  10-K.  Although  we  believe  our  current  level of
interest rate  sensitivity is reasonable and  effectively  managed,  significant
fluctuations  in  interest  rates may have an  adverse  effect on our  business,
financial condition and results of operations.

Our community  banking  strategy relies heavily on our management  team, and the
unexpected loss of key managers may adversely affect our operations:

Much of our  success  to date has been  influenced  strongly  by our  ability to
attract and to retain  senior  management  experienced  in banking and financial
services and familiar with the  communities  in our market area.  Our ability to
retain executive  officers,  the current  management teams,  branch managers and
loan officers will continue to be important to the successful  implementation of
our strategy.  It is also critical, as we grow, to be able to attract and retain
qualified additional  management and loan officers with the appropriate level of
experience and knowledge about our market area to implement our  community-based
operating  strategy.  The  unexpected  loss of  services  of any key  management
personnel,  or the  inability to recruit and retain  qualified  personnel in the
future,  could have an adverse effect on our business,  financial  condition and
results of operations.

                                       11
<PAGE>

Government regulation can result in limitations on our operations:

We operate in a highly regulated  environment and are subject to supervision and
regulation by a number of governmental regulatory agencies,  including the Board
of  Governors  of the Federal  Reserve  System,  the Federal  Deposit  Insurance
Corporation,   and  the  Illinois   Department  of  Financial  and  Professional
Regulation.  Regulations adopted by these agencies, which are generally intended
to provide  protection for depositors and customers  rather than for the benefit
of shareholders,  govern a comprehensive  range of matters relating to ownership
and control of our shares,  our  acquisition of other  companies and businesses,
permissible  activities  for us to engage in,  maintenance  of adequate  capital
levels and other aspects of our operations.  These bank regulators possess broad
authority to prevent or remedy unsafe or unsound practices or violations of law.
The laws and regulations  applicable to the banking industry could change at any
time and we cannot  predict the  effects of these  changes on our  business  and
profitability.  Increased  regulation  could increase our cost of compliance and
adversely affect  profitability.  For example, new legislation or regulation may
limit the manner in which we may conduct our business,  including our ability to
offer new products,  obtain financing,  attract deposits, make loans and achieve
satisfactory interest spreads.

We have a  continuing  need  for  technological  change  and we may not have the
resources to effectively implement new technology:

The financial services industry is undergoing rapid  technological  changes with
frequent  introductions  of new  technology-driven  products  and  services.  In
addition to better serving customers,  the effective use of technology increases
efficiency  and  enables  financial  institutions  to reduce  costs.  Our future
success  will  depend  in part  upon our  ability  to  address  the needs of our
customers by using technology to provide products and services that will satisfy
customer demands for convenience as well as to create additional efficiencies in
our  operations  as we continue to grow and expand our market area.  Many of our
larger   competitors  have   substantially   greater   resources  to  invest  in
technological improvements. As a result, they may be able to offer additional or
superior products to those that we will be able to offer,  which would put us at
a competitive  disadvantage.  Accordingly,  we cannot provide you with assurance
that we will be able to effectively implement new technology-driven products and
services  or be  successful  in  marketing  such  products  and  services to our
customers.

We are  subject to certain  operational  risks,  including,  but not limited to,
customer or employee fraud and data processing system failures and errors:

Employee  errors  and  misconduct  could  subject  us  to  financial  losses  or
regulatory  sanctions  and  seriously  harm our  reputation.  Misconduct  by our
employees  could include hiding  unauthorized  activities  from us,  improper or
unauthorized   activities  on  behalf  of  our  customers  or  improper  use  of
confidential  information.  It is not always possible to prevent employee errors
and misconduct,  and the precautions we take to prevent and detect this activity
may not be  effective  in all cases.  Employee  errors  could also subject us to
financial claims for negligence.

We maintain a system of internal  controls  and  insurance  coverage to mitigate
against operational risks,  including data processing system failures and errors
and customer or employee fraud.  Should our internal controls fail to prevent or
detect  an  occurrence,  or if any  resulting  loss is not  insured  or  exceeds
applicable  insurance  limits,  it could have a material  adverse  effect on our
business, financial condition and results of operations.

System failure or breaches of our network security could subject us to increased
operating costs as well as litigation and other liabilities:

The computer  systems and network  infrastructure  we use could be vulnerable to
unforeseen  problems.  Our  operations are dependent upon our ability to protect
our computer  equipment  against damage from physical theft,  fire,  power loss,
telecommunications  failure  or a similar  catastrophic  event,  as well as from
security  breaches,   denial  of  service  attacks,  viruses,  worms  and  other
disruptive  problems  caused by  hackers.  Any damage or failure  that causes an
interruption  in our  operations  could  have a material  adverse  effect on our
financial condition and results of operations.  Computer break-ins, phishing and
other  disruptions  could also jeopardize the security of information  stored in
and transmitted through our computer systems and network  infrastructure,  which
may result in  significant  liability to us and may cause existing and potential
customers to refrain from doing business with us.  Although we, with the help of
third-party  service  providers,   intend  to  continue  to  implement  security
technology and establish  operational  procedures to prevent such damage,  there
can be no  assurance  that  these  security  measures  will  be  successful.  In
addition,  advances in computer  capabilities,  new  discoveries in the field of
cryptography or other developments could result in a compromise or breach of the
algorithms we and our third-party  service  providers use to encrypt and protect
customer  transaction  data. A failure of such  security  measures  could have a
material adverse effect on our financial condition and results of operations.

                                       12
<PAGE>

We must effectively manage our credit risk:

There are risks inherent in making any loan, including risks inherent in dealing
with   individual   borrowers,   risks  of  nonpayment,   risks  resulting  from
uncertainties  as to the future value of  collateral  and risks  resulting  from
changes in economic and industry  conditions.  We attempt to minimize our credit
risk through prudent loan application approval procedures, careful monitoring of
the  concentration  of  our  loans  within  specific   industries  and  periodic
independent  reviews  of  outstanding  loans by our  credit  review  department.
However, we cannot assure you that such approval and monitoring  procedures will
reduce these credit risks.

Commercial,  financial and agricultural  loans make up a significant  portion of
our loan portfolio:

Commercial,   financial  and  agricultural  loans  were  $319.861  million,   or
approximately  31.5% of our total loan portfolio as of December 31, 2005.  These
loans are primarily made based on the  identified  cash flow of the borrower and
secondarily on the underlying  collateral provided by the borrower.  Most often,
this  collateral is accounts  receivable,  inventory,  machinery or real estate.
Credit  support  provided  by the  borrower  for  most of  these  loans  and the
probability of repayment is based on the  liquidation of the pledged  collateral
and enforcement of a personal guarantee, if any exists. As a result, in the case
of loans  secured by  accounts  receivable,  the  availability  of funds for the
repayment  of these loans may be  substantially  dependent on the ability of the
borrower to collect  amounts due from its  customers.  The  collateral  securing
these loans may  depreciate  over time,  may be  difficult  to appraise  and may
fluctuate in value based on the success of the business.

Our loan portfolio has a large  concentration  of commercial  real estate loans,
which involve risks specific to real estate value:

Commercial  real  estate  lending  (including  $119.673  million  in  commercial
construction loans discussed in the Commercial  Construction Loan section below)
is a large  portion  of our  loan  portfolio.  These  categories  were  $469.506
million,  or approximately  46.2% of our total loan portfolio as of December 31,
2005.  The market value of real estate can  fluctuate  significantly  in a short
period of time as a result of market  conditions in the geographic area in which
the real estate is  located.  Although a  significant  portion of such loans are
secured by real estate as a secondary form of collateral,  adverse  developments
affecting  real estate values in one or more of our markets  could  increase the
credit  risk  associated  with our loan  portfolio.  Additionally,  real  estate
lending  typically  involves higher loan principal  amounts and the repayment of
the loans generally is dependent,  in large part, on sufficient  income from the
properties  securing the loans to cover  operating  expenses  and debt  service.
Economic  events or  governmental  regulations  outside  of the  control  of the
borrower  or lender  could  negatively  impact the  future  cash flow and market
values of the affected properties.

If the loans that are  collateralized  by real estate become  troubled  during a
time when market  conditions are declining or have declined,  then we may not be
able to  realize  the  amount of  security  that we  anticipated  at the time of
originating  the loan,  which could cause us to increase our  provision for loan
losses and adversely affect our operating results and financial condition.

Our  commercial  construction  loans are based upon estimates of costs and value
associated with the complete  project.  These estimates may be inaccurate and we
may be exposed to more losses on these projects than on other loans:

At December 31, 2005, commercial  construction loans, including land acquisition
and  development,  totaled  $119.673  million,  or  11.8%,  of  our  total  loan
portfolio.  Construction  and land  acquisition and development  lending involve
additional  risks  because  funds are advanced upon the security of the project,
which  is  of  uncertain  value  prior  to  its   completion.   Because  of  the
uncertainties  inherent in estimating  construction costs, as well as the market
value of the  completed  project and the effects of  governmental  regulation of
real property, it is relatively difficult to evaluate accurately the total funds
required to complete a project and the related loan-to-value ratio. As a result,
commercial  construction  loans often involve the  disbursement  of  substantial
funds with repayment dependent,  in part, on the success of the ultimate project
and the ability of the borrower to sell or lease the  property,  rather than the
ability of the borrower or guarantor to repay  principal  and  interest.  If our
appraisal of the value of the completed project proves to be overstated,  we may
have  inadequate  security  for the  repayment  of the loan upon  completion  of
construction of the project.

Our concentration of one-to-four family residential mortgage loans may result in
lower yields and profitability:

One-to-four  family residential  mortgage loans comprised  $140.304 million,  or
13.8%,  and home equity lines of credit  (included in  installment  and consumer
loans) comprised  $39.078  million,  or 3.8%, of our loan and lease portfolio at
December  31,  2005,  and are secured  primarily  by  properties  located in the
counties  of  Champaign,   Macon,  Shelby,  Tazewell,  McLean,  Livingston,  and
contiguous  counties.  Our  concentration of these loans results in lower yields
and lower  profitability  for us. These loans are generally made on the basis of
the  borrower's  ability to make  repayments  from his or her employment and the
value of the property securing the loan.

                                       13
<PAGE>

Our allowance for loan losses may prove to be insufficient  to absorb  potential
losses in our loan portfolio:

Our management  establishes  our allowance for loan losses and maintains it at a
level  considered  adequate  to absorb  loan  losses  that are  inherent  in the
portfolio.  The  allowance  for  loan  losses  is a  material  estimate  that is
particularly  susceptible  to  significant  changes in the near term relating to
economic,  operating and other conditions,  including changes in interest rates,
which may be beyond our control,  and such losses may exceed current  estimates.
At December 31, 2005,  our  allowance  for loan losses as a percentage  of total
loans  was  1.32%  and  as  a  percentage  of  total  non-performing  loans  was
approximately 449.07%.  Although management believes that the allowance for loan
losses is adequate to absorb probable losses inherent in the loan portfolio,  we
cannot  predict loan losses with  certainty,  and we cannot  assure you that our
allowance  for loan losses will prove  sufficient to cover actual loan losses in
the  future.  Loan losses in excess of our  reserves  may  adversely  affect our
business, financial condition and results of operations.

Item 1.b. Unresolved Staff Comments

None

Item 2.   Properties

The Company and its subsidiaries conduct business in twenty-three locations. The
Company's  and Main  Street  Bank & Trust's headquarters are  located  at 100 W.
University Ave. in Champaign,  Illinois. The Company and/or its subsidiaries own
the land and buildings for fifteen locations and lease eight locations, three of
which are  located  in  supermarkets.  The  company  has plans to  construct  an
additional  facility in Peoria,  Illinois and to lease a new facility in Normal,
Illinois which would replace its current location.

Item 3.   Legal Proceedings

In the course of business,  the Company and its subsidiaries  become involved in
various legal  proceedings,  claims and  litigation  arising out of the ordinary
course of business.  As of the date of filing this report,  there were no causes
of action  which  would  have a  material  adverse  effect  on the  consolidated
financial position of the Company.


Item 4.   Submission of Matters to a Vote of Security Holders

There  were no items  submitted  to a vote of  security  holders  in the  fourth
quarter of 2005.

                                     PART II

Item 5.   Market  for Registrant's  Common Equity,  Related  Shareholder Matters
and Issuer Purchases of Equity Securities

The Company's common stock was held by approximately  700 shareholders of record
as of March 1, 2006 and is traded in the over-the-counter  market.

The  following  table  shows,  for the periods  indicated,  the range of closing
prices per share of the Company's common stock in the  over-the-counter  market,
as  reported to the  Company by the  brokers  known to the Company to  regularly
follow the market for the common stock.  Certain other private  transactions may
have  occurred  during  the  periods  indicated  of  which  the  Company  has no
knowledge.  The following  prices represent  inter-dealer  prices without retail
markups, markdowns or commissions.

<TABLE>

                                                                         Cash
                                                 High        Low       Dividends
                                               ---------------------------------
  <S>      <C>                                 <C>         <C>            <C>

  2004     First quarter                       $ 31.25     $ 30.60        $ 0.21
           Second quarter                        32.00       30.25          0.21
           Third quarter                         32.00       30.30          0.21
           Fourth quarter                        32.50       28.50          0.21

  2005     First quarter                       $ 30.00     $ 28.90        $ 0.22
           Second quarter                        30.00       28.65          0.22
           Third quarter                         29.40       28.55          0.22
           Fourth quarter                        30.00       29.30          0.22

</TABLE>
                                       14
<PAGE>

During the fourth quarter of 2005,  the Company  declared a $0.23 per share cash
dividend,  which was paid on January 27, 2006. The ability of the Company to pay
dividends  in the  future  will be  primarily  dependent  upon  its  receipt  of
dividends from the Bank. In determining  cash dividends,  the Board of Directors
considers  the  earnings,  capital  requirements,  debt and  dividend  servicing
requirements,  financial  ratio  guidelines  it has  established,  the financial
condition of the Company and other relevant  factors.  The Bank's ability to pay
dividends  to the  Company and the  Company's  ability to pay  dividends  to its
shareholders are also subject to certain regulatory restrictions.  See "Business
- Supervision and Regulation - The Company - Dividend  Payments" and "Business -
Supervision  and Regulation - The Bank  Subsidiaries - Dividend  Payments" for a
more detailed description of these limitations.

On October 27,  2003,  the Company  announced  that its Board of  Directors  had
reinstated the Stock Repurchase  Program (the "Program"),  allowing the purchase
of up to 500,000 shares of the Company's  outstanding stock.  82,712 shares were
repurchased during the fourth quarter of 2005.

<TABLE>
                      Issuer Purchases of Equity Securities
-----------------------------------------------------------------------------------------
                                                                  (c) Total   (d) Maximum
                                                                   Number of     Number
                                                                    Shares     of Shares
                                                                 Purchased as   that May
                                                                    Part of      Yet Be
                                         (a) Total                 Publicly    Purchased
                                         Number of   (b) Average  Announced    Under the
                                          Shares     Price Paid    Plans or     Plans or
Period                                   Purchased    Per Share    Programs     Programs
-----------------------------------------------------------------------------------------
<S>                                     <C>          <C>          <C>          <C>
October 1 -
October 31, 2005 ................           6,400    $   29.50       6,400      243,912

November 1 -
November 30, 2005 ...............          46,312    $   29.62      46,312      197,600

December 1 -
December 31, 2005 ...............          30,000    $   30.00      30,000      167,600
                                        -----------------------------------------------
     Total ......................          82,712    $   29.75      82,712      167,600
                                        ===============================================
</TABLE>
                                       15
<PAGE>

Item 6. Selected Consolidated Financial Data

The following table presents selected consolidated financial information for the
Company  for each of the five  years  ended  December  31,  2005.  The  selected
consolidated  financial data should be read in conjunction with the Consolidated
Financial  Statements  of the Company,  including the related  notes,  presented
elsewhere herein.

<TABLE>
                                                                             Year Ended December 31,
                                                      ------------------------------------------------------------------
                                                           2005        2004           2003          2002         2001
                                                      ------------------------------------------------------------------
                                                                 (dollars in thousands, except per share data)
                                                      ------------------------------------------------------------------
<S>                                                   <C>           <C>           <C>           <C>           <C>

Interest income ...................................   $   76,992    $   54,805    $   55,686    $   63,363    $   73,195
Interest expense ..................................       27,479        16,852        16,723        21,717        33,598
                                                      ------------------------------------------------------------------
Net interest income ...............................       49,513        37,953        38,963        41,646        39,597
Provision for loan losses .........................        1,530         1,100         1,470         1,450         2,670
                                                      ------------------------------------------------------------------
Net interest income after provision for loan losses       47,983        36,853        37,493        40,196        36,927
Non-interest income ...............................       20,477        19,847        20,294        18,866        17,266
Non-interest expense ..............................       39,779        33,879        32,341        33,161        30,286
Income tax expense ................................       10,373         8,043         8,841         8,520         7,736
                                                      ------------------------------------------------------------------
     Net income ...................................   $   18,308    $   14,778    $   16,605    $   17,381    $   16,171
                                                      ------------------------------------------------------------------
Basic earnings per share ..........................   $     1.82    $     1.56    $     1.62    $     1.61    $     1.48
                                                      ------------------------------------------------------------------
Diluted earnings per share ........................   $     1.80    $     1.54    $     1.60    $     1.60    $     1.45
                                                      ------------------------------------------------------------------
Return on average total assets ....................         1.24%         1.22%         1.47%         1.58%         1.47%
Return on average shareholders' equity ............        13.40%        13.08%        12.67%        12.79%        12.32%
Dividend payout ratio .............................        48.90%        54.49%        46.91%        33.54%        30.41%
Cash dividends declared per common share ..........   $     0.89    $     0.85    $     0.76    $     0.54    $     0.45
                                                      ------------------------------------------------------------------
Total assets ......................................   $1,625,137    $1,228,118    $1,154,174    $1,122,728    $1,151,511
Investment in debt and equity securities ..........      444,623       358,726       370,726       316,210       335,422
Loans held for investment, net ....................    1,002,927       761,227       666,259       664,142       673,061
Deposits ..........................................    1,275,972       974,577       898,472       868,586       884,109
Borrowings ........................................      185,838       126,782       132,978       108,457       120,102
Total shareholders' equity ........................      143,769       113,975       111,450       134,470       135,993
Total shareholders' equity to total assets ........         8.85%         9.28%         9.66%        11.98%        11.81%
Average shareholders' equity to average assets ....         9.26%         9.34%        11.63%        12.35%        11.91%
                                                      ------------------------------------------------------------------
</TABLE>

Item 7. Management's  Discussion and Analysis of Financial Condition and Results
of Operations

The following  discussion  and analysis is designed to provide the reader with a
comprehensive  review of the  consolidated  results of operations for 2005, 2004
and 2003 for the Company,  including  all  subsidiaries,  and an analysis of the
Company's financial condition at December 31, 2005 compared to December 31, 2004
and at December  31, 2004  compared to December 31, 2003.  This  discussion  and
analysis  should  be  read  in  conjunction  with  the  consolidated   financial
statements and related notes, which begin at page 34 of this report.

Overview

Net income  increased from $14.778  million in 2004 to $18.308  million in 2005,
and diluted  earnings per share  increased  from $1.54 in 2004 to $1.80 in 2005,
due in part to the  acquisition  of Citizens on April 1, 2005.  The net interest
margin  increased  during  2005 as a result of eight rate  hikes by the  Federal
Reserve during 2005 and an increase of $1.253 million in income from investments
in venture  capital funds in 2005 compared to 2004. Due to the nature of venture
capital  investments,  future results cannot be predicted based on past results.
Loan  demand  grew  during  2005  and  loan  quality   remained   strong,   with
non-performing  loans as a  percentage  of gross loans at 0.29% in 2005 and 2004
and 0.15% in 2003. Net income declined slightly, from $16.605 million in 2003 to
$14.778  million in 2004,  due to the  compression of the Company's net interest
margin;  one-time  expenses  associated  with the merger and name  change of our
subsidiary  banks, The First National Bank of Decatur and  BankIllinois,  in the
fourth  quarter;  and a decline  in  mortgage  loan  sales and  related  income.
Interest  rates  remained at  unprecedented  low levels during the first half of
2004 and they  increased  in the second half of 2004 as a result five rate hikes
by the Federal  Reserve.  However,  the net interest  margin showed a pattern of
increasing during the fourth quarter of 2004, a trend that continued into 2005.

                                       16
<PAGE>

On April 1, 2005, the Company acquired all of the outstanding stock of Citizens.
The  transaction  has been accounted for as a purchase.  Assets and  liabilities
related  to the  acquisition  of  Citizens  are  reported  as of the April  2005
acquisition  date.  Results of operations of Citizens since the acquisition date
have been included in the Company's consolidated financial statements.

Segment Operations

FirsTech,  Inc.  operates  as a  separate  segment  of the  Company.  Results of
Firstech's  operations  are  included as  non-interest  income and  non-interest
expense of the Company.

Critical Accounting Policies

The Company's significant accounting policies are more fully described in Note 1
to the Company's  consolidated  financial  statements  located in Item 8 of this
Annual  Report  on  form  10-K.  The  preparation  of  financial  statements  in
conformity with accounting principles generally accepted in the United States of
America  requires  management to make estimates and assumptions  that affect the
reported amounts of assets, liabilities,  revenues, and expenses and the related
disclosures of contingent  assets and  liabilities.  Actual results could differ
from those  estimates  under  different  assumptions or conditions.  The Company
believes that it has one critical accounting policy that is subject to estimates
and judgements used in the preparation of its consolidated financial statements.

Allowance for Loan Losses.  The allowance for loan losses is a material estimate
that is  particularly  susceptible to significant  changes in the near term. The
allowance for loan losses is increased by provisions  charged to operations  and
is reduced by loan charge-offs less recoveries. Management utilizes an approach,
which provides for general and specific valuation  allowances,  that is based on
current  economic  conditions,   past  losses,   collection   experience,   risk
characteristics  of the portfolio,  assessment of collateral values by obtaining
independent appraisals for significant properties, and such other factors which,
in management's judgmen4, deserve current recognition in estimating loan losses,
to  determine  the  appropriate  level of the  allowance  for loan  losses.

The allowance for loan losses  related to impaired loans that are identified for
evaluation is based on discounted  cash flow using the loan's initial  effective
interest  rate or the fair value,  less selling  costs,  of the  collateral  for
collateral  dependent loans.  Loans are categorized as "impaired" when, based on
current information or events, it is probable that the Company will be unable to
collect all amounts due,  including  principal and interest,  in accordance with
the contractual terms of the loan agreement. The Company reviews all non-accrual
and  substantially  delinquent  loans,  as well as problem  loans  identified by
management, for impairment as defined above. A specific allowance amount will be
established  for impaired  loans in which the present value of the expected cash
flows to be  generated  is less  than the  amount  of the loan  recorded  on the
Company's books. As an alternative to discounting, the Company may use the "fair
value" of any collateral supporting a collateral-dependent loan in reviewing the
necessity for  establishing  a specific  loan loss  allowance  amount.  Specific
allowances  will be  established  for accounts  having a  collateral  deficiency
estimated to be $50,000 or more. The Company's  general  allowance is maintained
at an adequate  level to cover accounts  having a collateral  deficiency of less
than $50,000.  Loans  evaluated as groups or homogeneous  pools of loans will be
excluded from this analysis.

The Company  utilizes its data  processing  system to identify loan payments not
made by their contractual due date and to calculate the number of days each loan
exceeds  the  contractual  due date.  The  accrual  of  interest  on any loan is
discontinued when, in the opinion of management, there is reasonable doubt as to
the collectibility of interest or principal.  Management  believes the allowance
for loan losses is adequate to absorb  probable  credit  losses  inherent in the
loan portfolio.  However,  there can be no assurance that the allowance for loan
losses will be adequate to cover all losses.  While  management  uses  available
information to recognize loan losses, future additions to the allowance for loan
losses may be necessary  based on changes in economic  conditions.  In addition,
various regulatory  agencies,  as an integral part of their examination process,
periodically review the adequacy of the allowance for loan losses. Such agencies
may require the Company to recognize  additions to the allowance for loan losses
based on their  judgments of information  available to them at the time of their
examination.

Results of Operations

The Company had earnings of $18.308  million in 2005 compared to $14.778 million
in 2004 and $16.605  million in 2003. The Company had a return on average assets
of 1.24%, 1.22% and 1.47% in 2005, 2004 and 2003,  respectively.  Basic earnings
per share  were  $1.82,  $1.56 and $1.62 in 2005,  2004 and 2003,  respectively.
Diluted  earnings per share was $1.80,  $1.54 and $1.60 in 2005,  2004 and 2003,
respectively.  Management  believes that a strong balance sheet and earnings are
critical to success.

                                       17
<PAGE>

Net Interest Income

Interest  rates and fees charged on loans are  affected  primarily by the market
demand for loans and the supply of money available for lending  purposes.  These
factors are affected by, among other things, general economic conditions and the
policies of the Federal  government,  including  the Board of  Governors  of the
Federal Reserve,  legislative tax policies and governmental  budgetary  matters.

Net interest income, the most significant  component of the Company's  earnings,
is the difference  between interest received or accrued on the Company's earning
assets--primarily  loans  and  investments--and  interest  paid  or  accrued  on
deposits  and  borrowings.  In order to  compare  the  interest  generated  from
different  types of earning assets,  the interest  income on certain  tax-exempt
investment  securities  and loans is increased for analysis  purposes to reflect
the income tax savings  provided by these tax-exempt  assets.  The adjustment to
interest  income for tax-exempt  investment  securities and loans was calculated
based on the federal  income tax  statutory  rate of 35%. The  adjustment to net
interest  income  for the tax  effect  of  tax-exempt  assets  is  shown  in the
following schedule.

<TABLE>

                  Net Interest Income on a Tax Equivalent Basis
                                 (in thousands)
--------------------------------------------------------------------------------
                                                 2005        2004         2003
                                               ---------------------------------
<S>                                            <C>          <C>          <C>
Total interest income ...................      $76,992      $54,805      $55,686
Total interest expense ..................       27,479       16,852       16,723
                                               ---------------------------------
     Net interest income ................       49,513       37,953       38,963
Tax equivalent adjustment:
     Tax-exempt investments .............          816          993        1,222
     Tax-exempt loans ...................           15           12           16
                                               ---------------------------------
       Total adjustment .................          831        1,005        1,238
                                               ---------------------------------
Net interest income (TE) ................      $50,344      $38,958      $40,201
                                               =================================
</TABLE>


                                       18
<PAGE>
The following schedule, "Consolidated Average Balance Sheet and Interest Rates",
provides details of average balances,  interest income or interest expense,  and
the average rates for the Company's major asset and liability categories.

<TABLE>

                                                         Consolidated Average Balance Sheet and Interest Rates
                                                                             (dollars in thousands)
                                       ---------------------------------------------------------------------------------------------
                                                      2005                              2004                        2003
                                       ---------------------------------------------------------------------------------------------
                                         Average                           Average                         Average
                                         Balance     Interest     Rate     Balance    Interest    Rate     Balance    Interest  Rate
                                       ---------------------------------------------------------------------------------------------
<S>                                    <C>         <C>           <C>    <C>         <C>          <C>   <C>         <C>        <C>
Assets
Taxable investment securities(1) ...   $  326,932  $   12,465    3.81%  $  327,064  $   10,793   3.30% $  305,146  $  11,502  3.77%
Tax-exempt investment
  securities(1)(TE) ................       39,195       2,332    5.95%      46,214       2,837   6.14%     55,601      3,492  6.28%
Federal funds sold and interest
  bearing deposits(2) ..............       49,020       2,023    4.13%      37,910         600   1.58%     36,786        447  1.22%
Loans (3),(4) (TE) .................      945,089      61,003    6.45%     711,986      41,580   5.84%    645,543     41,483  6.43%
                                       ---------------------------------------------------------------------------------------------
  Total interest earning assets
    and interest income (TE) .......   $1,360,236  $   77,823    5.72%  $1,123,174 $   55,810   4.97%  $1,043,076  $  56,924  5.46%
                                       ---------------------------------------------------------------------------------------------
Cash and due from banks ............   $   44,210                       $   44,965                     $   45,872
Premises and equipment .............       21,239                           17,184                         17,864
Other assets .......................       49,006                           23,944                         19,848
                                       ---------------------------------------------------------------------------------------------
  Total assets .....................   $1,474,691                       $1,209,267                     $1,126,660
                                       =============================================================================================
Liabilities and Shareholders' Equity
Interest bearing demand deposits ...   $   74,976  $      426    0.57%  $   93,315  $      635   0.68% $   87,351  $     641   0.73%
Savings ............................      427,341       7,529    1.76%     345,624       3,432   0.99%    284,641      2,586   0.91%
Time deposits ......................      440,592      13,634    3.09%     352,596       9,905   2.81%    337,737     10,843   3.21%
Federal funds purchased, repurchase
  agreements and notes payable .....      115,679       3,097    2.68%      97,503       1,271   1.30%     95,029      1,094   1.15%
FHLB advances & other
  borrowings .......................       60,351       2,793    4.63%      29,925       1,609   5.38%     28,492      1,559   5.47%
                                       ---------------------------------------------------------------------------------------------
  Total interest bearing liabilities
    and interest expense ...........   $1,118,939  $   27,479    2.46%  $  918,963  $   16,852   1.83% $  833,250  $  16,723   2.01%
                                       ---------------------------------------------------------------------------------------------
Non-interest bearing demand
  deposits .........................      132,982                          100,913                         89,935
Non-interest bearing savings
  deposits .........................       71,535                           66,163                         62,056
Other liabilities ..................       14,614                           10,260                         10,339
                                       ---------------------------------------------------------------------------------------------
  Total liabilities ................   $1,338,070                       $1,096,299                     $  995,580
Shareholders' equity ...............      136,621                          112,968                        131,080
                                       ---------------------------------------------------------------------------------------------
  Total liabilities and
    shareholders' equity ...........   $1,474,691                       $1,209,267                     $1,126,660
                                       =============================================================================================
Interest spread (average
  rate earned minus
  average rate paid) (TE) ..........                               3.26%                            3.14%                      3.45%
                                       =============================================================================================
Net interest income (TE) ...........               $   50,344                       $   38,958                     $  40,201
                                       =============================================================================================
Net yield on interest
  earnings assets (TE) .............                               3.70%                            3.47%                      3.85%
                                       =============================================================================================
Notes: see next page for notes 1-4.

Notes to Consolidated Average Balance Sheet and Interest Rates Table:
<FN>

     (1)  Investments in debt securities are included at carrying value.  Income
          from  investments  in venture  capital funds of  approximately  $1.557
          million,  $304,000 and $303,000 in 2005, 2004 and 2003,  respectively,
          is included in interest income from taxable investment securities. Due
          to the nature of venture capital investments, future results cannot be
          predicted based on past performance.

     (2)  Federal funds sold and interest earning deposits include approximately
          $275,000, $66,000 and $71,000 in 2005, 2004 and 2003, respectively, of
          interest income from third party processing of cashier checks.

     (3)  Loans are net of allowance of loan losses and include  mortgage  loans
          held for sale. Nonaccrual loans are included in the total.

     (4)  Loan fees of approximately  $1.181 million,  $1.410 million and $1.706
          million in 2005,  2004 and 2003,  respectively,  are included in total
          loan income.
</FN>

</TABLE>
                                       19
<PAGE>
The following table presents,  on a fully taxable  equivalent basis, an analysis
of changes in net interest  income  resulting from changes in average volumes of
earning  assets and interest  bearing  liabilities  and average rates earned and
paid. The change in interest due to the combined  rate/volume  variance has been
allocated  to rate and  volume  changes in  proportion  to the  absolute  dollar
amounts of change in each.

<TABLE>

                                                          Analysis of Volume and Rate Changes
                                                                      (in thousands)
                                       ----------------------------------------------------------------------
                                                        2005                               2004
                                       ----------------------------------------------------------------------
                                        Increase                              Increase
                                       (Decrease)                            (Decrease)
                                          from                                  from
                                        Previous       Due to    Due to       Previous    Due to      Due to
                                          Year         Volume     Rate          Year      Volume       Rate
                                       ----------------------------------------------------------------------
<S>                                     <C>         <C>         <C>         <C>         <C>         <C>
Interest Income
  Taxable investment securities .....   $  1,672    $     (4)   $  1,676    $   (709)   $    788    $ (1,497)
  Tax-exempt investment securities ..       (505)       (420)        (85)       (655)       (578)        (77)
  Federal funds sold and interest
    bearing deposits ................      1,423         219       1,204         153          14         139
  Loans .............................     19,423      14,697       4,726          97       4,063      (3,966)
                                        ---------------------------------------------------------------------
    Total interest income ...........   $ 22,013    $ 14,492    $  7,521    $ (1,114)   $  4,287    $ (5,401)
                                        ---------------------------------------------------------------------
Interest Expense
  Interest bearing demand
    and savings deposits ............   $  3,888    $    393    $  3,495    $    840    $    609    $    231
  Time deposits .....................      3,729       2,650       1,079        (938)        461      (1,399)
  Federal funds purchased, repurchase
    agreements and notes payable ....      1,826         275       1,551         177          29         148
  Federal Home Loan Bank advances
    and other borrowings ............      1,184       1,435        (251)         50          77         (27)
                                        ---------------------------------------------------------------------
    Total interest expense ..........   $ 10,627    $  4,753    $  5,874    $    129    $  1,176    $ (1,047)
                                        ---------------------------------------------------------------------
Net Interest Income (TE) ............   $ 11,386    $  9,739    $  1,647    $ (1,243)   $  3,111    $ (4,354)
                                        =====================================================================
</TABLE>


Total average  earning  assets  increased  from $1.123 billion in 2004 to $1.360
billion in 2005 and generated  higher  interest  income on a tax equivalent (TE)
basis,  mainly as a result of the  Citizens  acquisition  along  with  increased
interest  rates in 2005  compared  to 2004.  Average  loans  increased  $233.103
million, resulting in an increase in interest income (TE) of $19.423 million, of
which  $14.697  million  was due to higher  volume and $4.726  million due to an
increase in rates.  Average  federal  funds sold and  interest-bearing  deposits
increased $11.110 million and generated $1.423 million more interest income than
in 2004,  of which  $1.204  million was due to an increase in rates and $219,000
due to higher volume.  Somewhat  offsetting  these increases in average balances
was a decrease in average  tax-exempt  investment  securities of $7.019 million,
resulting  in a decrease in  interest  income of  $505,000,  mainly due to lower
volume.  Average taxable investment securities decreased $132,000, but generated
$1.672 million more interest income, primarily due to higher rates.

Total average  earning  assets  increased  from $1.043 billion in 2003 to $1.123
billion in 2004,  but  generated  lower  interest  income  mainly as a result of
reduced interest rates in 2004 compared to 2003. Average loans increased $66.443
million, resulting in an increase in interest income of $97,000, of which $4.063
million was due to volume,  offset  somewhat by $3.966 million due to a decrease
in interest  rates.  Average taxable  investment  securities  increased  $21.918
million,  but generated  $709,000 less interest income,  of which $1.497 million
was due to lower  rates,  offset  somewhat  by  $788,000  due to an  increase in
volume.  Average  federal  funds sold and  interest-bearing  deposits  increased
$1.124  million and generated  $153,000 more interest  income,  mainly due to an
increase in rates. Somewhat offsetting these increases in average balances was a
decrease  in  average  tax-exempt   investment  securities  of  $9.387  million,
resulting in a decrease in interest  income of $655,000,  of which  $578,000 was
due to lower volume and $77,000 was attributable to a decrease in rates.

                                       20
<PAGE>

The  following  table  summarizes  the  quarterly  increase  (decrease) in total
interest income, total interest expense and net interest income in 2005 and 2004
compared to the same  periods the prior year.  Between July 1, 2004 and December
31, 2005,  there were 13 increases in the prime interest rate of 25 basis points
each.

<TABLE>

                                 Total          Total        Net
                                Interest       Interest   Interest
                                Income (TE)    Expense   Income (TE)
                               ------------------------------------
<S>     <C>                     <C>          <C>          <C>
2004    First quarter ......    $ (1,232)    $   (638)    $   (594)
        Second quarter .....        (824)        (264)        (560)
        Third quarter ......         (83)         376         (459)
        Fourth quarter .....       1,025          655          370
                                ----------------------------------
        Year-to-date .......    $ (1,114)    $    129     $ (1,243)
                                ==================================

2005    First quarter ......    $    956     $    611     $    345
        Second quarter .....       6,818        2,923        3,895
        Third quarter ......       7,415        3,166        4,249
        Fourth quarter .....       6,824        3,927        2,897
                                ----------------------------------
        Year-to-date .......    $ 22,013     $ 10,627     $ 11,386
                                ==================================
</TABLE>

The Company  establishes  interest  rates on loans and deposits  based on market
rates such as the 91-day  Treasury Bill rate and the national prime rate,  while
at the same time being  mindful of  interest  rates  offered by other  financial
institutions  in the  local  community.  The  level  of risk  and the  value  of
collateral also are evaluated when determining loan rates.  Rates were generally
higher in 2005  compared to 2004.  The average  yield on federal  funds sold and
interest  bearing-deposits  increased  255 basis  points,  from 1.58% in 2004 to
4.13% in 2005.  The average rate earned on loans  increased 61 basis points from
5.84% in 2004 to  6.45%  in  2005.  The  average  yield  on  taxable  investment
securities increased 51 basis points, from 3.30% in 2004 to 3.81% in 2005. These
higher average yields were primarily due to eight interest rate hikes  initiated
by the Federal Reserve during 2005.  Somewhat offsetting these higher yields was
a decrease in the average yield on tax-exempt  investment securities of 19 basis
points from 6.14% in 2004 to 5.95% in 2005.

The total  actual  balance of loans at  December  31,  2005 was  higher  than at
December 31, 2004. Commercial, financial and agricultural loans increased $5.204
million  from 2004 to 2005.  Commercial  real estate  loans  increased  $159.676
million  from 2004 to 2005.  Residential  real estate  loans  increased  $77.840
million from 2004 to 2005.  Installment  and  consumer  loans  increased  $2.802
million from 2004 to 2005.

Average rates on total interest bearing  liabilities  increased 63 basis points,
from  1.83%  in 2004 to 2.46% in 2005 and  interest  expense  increased  $10.627
million in 2005 compared to 2004 due to increases in both rates and volume.  The
overall  increase  in  interest  expense  was caused by an  increase in interest
expense on all categories of interest bearing liabilities. The average rate paid
on federal funds purchased,  repurchase  agreements and notes payable  i.creased
138  basis  points  from  1.30% in 2004 to 2.68% in 2005.  This  resulted  in an
increase in interest expense of $1.826 million,  of which $1.551 million was due
to higher rates and $275,000 was due to an increase in volume.  The average rate
paid on interest bearing demand and savings deposits  increased 65 basis points,
from 0.93% in 2004 to 1.58% in 2005.  This  resulted  in an increase in interest
expense of $3.888 million in 2005, of which $3.495 million was  attributable  to
increased  rates and $393,000 was due to higher rates.  The average rate paid on
time deposits  increased 28 basis  points,  from 2.81% in 2004 to 3.09% in 2005.
This  resulted in an increase of $3.729  million in interest  expense,  of which
$2.650  million was due to an  increase in volume and $1.079  million was due to
higher rates.  Although the average rate paid on Federal Home Loan Bank advances
and other borrowings  decreased 75 basis points,  from 5.38% in 2004 to 4.63% in
2005,  interest  expense  increased a total of $1.184  million,  of which $1.435
million was due to higher volume,  offset somewhat by $251,000 due to a decrease
in rates.

                                       21
<PAGE>

Average rates on total interest bearing  liabilities  decreased 18 basis points,
from 2.01% in 2003 to 1.83% in 2004, but interest expense increased  $129,000 in
2004  compared  to 2003 due to an  increase  in  volume,  offset  somewhat  by a
decrease  in rates.  The overall  increase in interest  expense was caused by an
increase in interest  expense on interest  bearing demand and savings  deposits,
federal funds  purchased,  repurchase  agreements  and notes payable and Federal
Home Loan Bank advances and other  borrowings,  offset somewhat by a decrease in
interest  expense  on time  deposits.  The  average  rate paid on time  deposits
decreased 40 basis points, from 3.21% in 2003 to 2.81% in 2004. This resulted in
a decrease of $938,000 in interest  expense,  of which $1.399 million was due to
lower rates,  offset somewhat by a $461,000 increase in volume. The average rate
paid on Federal Home Loan Bank advances and other  borrowings  decreased 9 basis
points, from 5.47% in 2003 to 5.38% in 2004. However, interest expense increased
a total of $50,000,  comprised of $77,000 due to higher volume, which was offset
somewhat by $27,000 due to a decrease in rates. The average rate paid on federal
funds  purchased,  repurchase  agreements  and notes payable  increased 15 basis
points  from 1.15% in 2003 to 1.30% in 2004.  This  resulted  in an  increase in
interest  expense of  $177,000  of which  $148,000  was due to higher  rates and
$29,000  was due to an increase  in volume.  The  average  rate paid on interest
bearing demand and savings deposits increased 6 basis points, from 0.87% in 2003
to 0.93% in 2004.  This resulted in an increase in interest  expense of $840,000
in 2004, of which $609,000 was attributable to increased volume and $231,000 was
due to higher rates.

Provision for Loan Losses

The  quality of the  Company's  loan  portfolio  is of prime  importance  to the
Company's  management  and its  board of  directors,  as loans  are the  largest
component of the Company's assets.  The Company maintains an independent  credit
administration   function,   which   performs   reviews  of  all  large   credit
relationships and all loans that present indications of additional credit risk.

Net charge-offs decreased to $1.142 million in 2005 from $1.236 million in 2004.
The Company  charged off $1.459  million in loans during 2005 compared to $1.692
million in 2004.  This was due to a decrease in charge-offs  for installment and
consumer loans of $513,000 in 2005 compared to 2004. This decrease was primarily
the result of a reduction in Owners Option indirect vehicle program  charge-offs
from $415,000 in 2004 to $5,000 in 2005.  This decreases was offset  somewhat by
increases in charge-offs for commercial,  financial and  agricultural  loans and
residential real estate loans of $264,000 and $16,000, respectively.  Recoveries
of previously  charged off loans  decreased from $456,000 in 2004 to $317,000 in
2005,  with the  largest  decrease  in the  area of  commercial,  financial  and
agricultural  loans,  which decreased  $180,000 from 2004 to 2005. The provision
for loan losses increased $430,000 from $1.100 million in 2004 to $1.530 million
in 2005 and the ratio of net charge-offs to average net loans decreased to 0.12%
in 2005 from 0.17% in 2004. The Company  continues to emphasize  credit analysis
and early detection of problem loans.

                                       22
<PAGE>

Noninterest Income and Expense

The following table summarizes  selected  categories of non-interest  income and
non-interest  expense for the years ended  December 31 2005,  2004 and 2003. The
acquisition  of Citizens on April 1, 2005, has been accounted for as a purchase.
Results of operations of Citizens since the acquisition  date have been included
in the Company's  consolidated  financial statements.  The Company's new banking
center in East Peoria,  Illinois became fully  operational in the fourth quarter
of 2004.

<TABLE>

                         Noninterest Income and Expense
                        for the Year Ended: December 31,
-------------------------------------------------------------------------------
Non-interest Income (in thousands)                 2005       2004        2003
                                               --------------------------------
<S>                                            <C>         <C>        <C>
Remittance processing (1)....................  $  6,748    $  7,201   $  7,211
Trust and brokerage fees (2) ................     7,599       6,492      5,783
Service charges on deposit accounts (3) .....     2,923       2,419      2,545
Securities transactions, net (4) ............      (586)        133        (12)
Gain on sales of mortgage loans, net (5) ....       886         997      2,536
Other (6) ...................................     2,907       2,605      2,231
                                               --------------------------------
       Total non-interest income ............  $ 20,477    $ 19,847   $ 20,294
                                               ================================

Non-interest Expense (in thousands)                2005       2004       2003
                                               --------------------------------
Salaries and employee benefits (7) ..........  $ 23,099    $ 18,889   $ 18,245
Occupancy (8) ...............................     3,074       2,669      2,489
Equipment ...................................     2,592       2,512      2,389
Data processing (9) .........................     2,416       2,283      2,108
Office supplies .............................     1,245       1,247      1,266
Service charges from correspondent banks (10)       513         781        931
Amortization of core deposit intangibles (11)       653          --         --
Other (12) ..................................     6,187       5,498      4,913
                                               --------------------------------
       Total non-interest expense ...........  $ 39,779    $ 33,879   $ 32,341
                                               ================================
<FN>
     (1)  Remittance  processing  income  decreased  $453,000,  or 6.3%, in 2005
          compared to 2004. This was due to an $867,000,  or 40.2%,  decrease in
          lockbox  processing  income,  offset somewhat by a $434,000,  or 8.7%,
          increase in  electronic  processing  income.  The  decrease in lockbox
          processing  income was mainly due to the loss of two major accounts in
          the fourth  quarter of 2004.  This decrease was offset  somewhat by an
          increase  in  electronic  processing  income  from  new  and  existing
          Internet  Agent  customers.  In  2004,  remittance  processing  income
          remained almost unchanged compared to 2003.

     (2)  Trust and brokerage fees increased  $1.107 million,  or 17.1%, in 2005
          compared  to 2004.  Included  in this  increase  were a  $391,000,  or
          262.7%,  increase in farm realty  income  mainly  attributable  to the
          environment  surrounding  elevated land values and sales activity as a
          result, and a $325,000,  or 127.9%,  increase in estate fees primarily
          as a result  of  serving  as  executor  to one  large  estate.  Wealth
          Management Group assets under management  increased  $194.000 million,
          or 11.0%,  to $1.959  billion at December 31, 2005 from $1.765 billion
          at December 31, 2004. Trust and brokerage fees increased $709,000,  or
          12.3%,  in 2004  compared  to 2003.  This  increase  was the result of
          strong  investment  performance for existing clients and obtaining new
          investment  accounts.  Wealth Management Group assets under management
          increased  $251.000  million to $1.765  billion at  December  31, 2004
          compared to $1.514 billion at December 31, 2003.

     (3)  Service charges on deposit accounts increased  $504,000,  or 20.8%, in
          2005  compared  to  2004.  The  Company's  new  Bloomington  locations
          generated  $733,000 in service charges on deposit  accounts.  In 2004,
          service charges on deposit accounts decreased $126,000,  or 5.0%, from
          $2.545  million at December 31, 2003 to $2.419 million at December 31,
          2004.

     (4)  Loss from securities  transactions was $586,000 in 2005, compared to a
          gain of  $133,000  in 2004.  This loss was due to  $601,000  in losses
          realized on an investment in one venture capital fund, offset slightly
          by net gains of  $15,000 on sales of several  equity  securities.  The
          income from securities transactions of $133,000 in 2004 represented an
          increase of $145,000 compared to 2003. This increase was due to a gain
          on the sale of one security.

                                       23
<PAGE>

     (5)  Gains on sales of mortgage loans decreased $111,000, or 11.1%, in 2005
          compared to 2004. This decrease was due to a decrease of approximately
          $11.530  million,  or 15.0%, in mortgage loans funded in 2005 compared
          to 2004, primarily as a result of a decrease in refinancings. Gains on
          sales of mortgage loans decreased  $1.539  million,  or 60.7%, in 2004
          compared to 2003. This decrease was due to a decrease of approximately
          $132.328 million,  or 63.3%, in mortgage loans funded in 2004 compared
          to 2003, primarily as a result of a decrease in refinancings.

     (6)  Other  non-interest  income  increased  $302,000,  or  11.6%,  in 2005
          compared to 2004. Included in this increase was a $178,000 increase in
          key man insurance  income due to $120,000 of income from the Company's
          new  Bloomington  locations and $58,000 in proceeds from two policies.
          Other  non-interest  income  increased  $374,000,  or  16.8%,  in 2004
          compared to 2003.  Included in other non-interest income in 2004 was a
          $291,000 gain on the sale of two parking lots.

     (7)  Salaries and employee benefits increased $4.210 million,  or 22.3%, in
          2005 compared to 2004.  Included in salaries and employee  benefits in
          2005 was $2.265 million  attributable to the Company's new Bloomington
          locations and $454,000  attributable  to the Company's new East Peoria
          banking  branch.  In 2004,  salaries and employee  benefits  increased
          $644,000, or 3.5%, compared to 2003.

     (8)  Occupancy  expense increased  $405,000,  or 15.2%, in 2005 compared to
          2004. Of this increase, $400,000 was attributable to the Company's new
          Bloomington locations.  In 2004, occupancy expense increased $180,000,
          or 7.2%, compared to 2003.

     (9)  Data processing expense increased $133,000,  or 5.8%, in 2005 compared
          to 2004. This increase was attributable, in part, to the Company's new
          Bloomington locations.  Data processing expense increased $175,000, or
          8.3%,  in 2004  compared to 2003.  In 2004,  data  processing  expense
          included   additional  costs  related  to  the  subsidiary  merger  of
          BankIllinois and The First National Bank of Decatur.

     (10) Service charges from correspondent banks decreased $268,000, or 34.3%,
          in 2005  compared  to 2004.  This was  largely  due to the loss of two
          lockbox  accounts  in the  fourth  quarter  of  2004 as  described  in
          footnote 1, which resulted in a significant decrease in cleared checks
          during 2005 compared to 2004.

     (11) The   amortization  of  core  deposit   intangibles  of  $653,000  was
          attributable to the acquisition of Citizens.

     (12) Other  non-interest  expense  increased  $689,000,  or 12.5%,  in 2005
          compared to 2004.  This was mainly due to the  acquisition of Citizens
          and the Company's new East Peoria banking location. Other non-interest
          expense  increased  $585,000,  or  11.9%,  in 2004  compared  to 2003.
          Included  in other  non-interest  expense  in 2004 were  approximately
          $413,000 of additional  marketing research and agency fees,  primarily
          related to the merger of  BankIllinois  and The First National Bank of
          Decatur for  purposes of  marketing,  promotion  and  branding the new
          entity,  Main  Street  Bank & Trust,  direct  loan  promotional  costs
          relating to the  increase in home equity  loans and  additional  costs
          related to Sarbanes-Oxley compliance.
</FN>

</TABLE>

Income Tax Expense

Income tax expense  increased $2.330 million,  or 29.0%,  from $8.043 million in
2004 to $10.373  million in 2005.  This was mainly due to an increase in taxable
income.  In 2004, income tax expense  decreased  $798,000,  or 9.0%, from $8.841
million in 2003. The Company's effective tax rate was 36.2%, 35.2% and 34.7% for
the years ended December 31, 2005, 2004 and 2003, respectively.

The tax  effects  of  temporary  differences,  which  gave  rise to  significant
portions of the deferred tax assets and deferred tax liabilities at December 31,
2005 and  2004,  are  shown in note 11 in the  Notes to  Consolidated  Financial
Statements.

Financial Condition

Total assets increased $397.019 million, or 32.3%, to $1.625 billion at December
31, 2005 compared to $1.228  billion at December 31, 2004.  There were increases
in all asset categories except investments in debt and equity securities held to
maturity. Most of the change in total assets was attributable to the acquisition
of Citizens.  Assets and liabilities  related to the acquisition of Citizens are
reported as of the April 2005 acquisition date. On April 1, 2005, Citizens total
assets were $330.983 million.

Cash and due from banks increased $18.874 million,  or 57.0%, to $52.007 million
at December  31, 2005  compared to $33.133  million at December  31,  2004.  The
Citizens acquisition  contributed $6.022 million to the increase in cash and due
from banks.

                                       24
<PAGE>

Federal funds sold and interest bearing deposits  increased $10.264 million,  or
32.3%,  to $42.059  million at December 31, 2005 compared to $31.795  million at
December 31, 2004. The Citizens acquisition contributed $16.630 million. Federal
funds sold and interest  bearing  deposits  fluctuate with loan demand,  deposit
volume and investment opportunities.

Total  investments in debt and equity securities  increased $85.897 million,  or
23.9%, to $444.623  million at December 31, 2005 compared to $358.726 million at
December 31, 2004.  Included in the change were increases of $73.507 million, or
27.3%, in investments in securities  available for sale and $17.012 million,  or
213.1%,  in  non-marketable  equity  securities offset somewhat by a decrease of
$4.622 million, or 5.7%, in securities held to maturity. $16.374 million of FHLB
Stock  owned by  Citizens  on April  1,  2005 is  included  in the  increase  in
non-marketable equity securities.  The Citizens acquisition  contributed $23.865
million of investments in securities available for sale.  Investments  fluctuate
with loan demand, deposit volume and investment opportunities.

Loans, net of allowance for loan losses,  increased $241.700 million,  or 31.8%,
to $1.003  billion at December  31, 2005 from  $761.227  million at December 31,
2004. The Citizens  acquisition  contributed $228.114 million to the increase in
loans.

Mortgage loans held for sale increased $656,000,  or 65.3%, to $1.661 million at
December 31, 2005 compared to $1.005  million at December 31, 2004. The Citizens
acquisition contributed $282,000 to the increase.

The increase in year-end  assets was primarily the result of the  acquisition of
Citizens  which  had  total  assets  of  $330.983  million  at  April  1,  2005.
Contributing to the increase in total assets was the $301.395  million  increase
in total  deposits at December 31, 2005  compared to December 31, 2004.  Of this
$301.395 million  increase in total deposits,  $232.089 million was attributable
to the  acquisition  of  Citizens.  The  increase in deposits  included  $67.915
million in non-interest bearing deposits ($28.496 million due to the acquisition
of Citizens) and $233.480 million in interest bearing deposits ($203.593 million
due to the  acquisition  of  Citizens).  Also  contributing  to the  increase in
year-end  assets was a $21.552  million  increase  in federal  funds  purchased,
repurchase agreements and notes payable (none due to the Citizens  acquisition),
a  $37.504  million  increase  in  Federal  Home Loan  Bank  advances  and other
borrowings ($37.599 million due to the acquisition of Citizens).

Average  assets  were  $265.424  million,  or 21.9%,  higher in 2005 than  2004.
Included  in the  increase  in average  assets  were  increases  in net loans of
$233.103 million, or 32.7%, other assets of $25.062 million, or 104.7%,  federal
funds sold and  interest  bearing  deposits of $11.110  million,  or 29.3%,  and
premises  and  equipment  of $4.055  million,  or 23.6%.  These  increases  were
somewhat offset by average decreases of $7.019 million,  or 15.2%, in tax-exempt
investment  securities,  a decrease of $755,000,  or 1.7%,  in cash and due from
banks, and a decrease of $132,000 in taxable investment securities.

Shifts in funding sources occurred as total average deposits  increased $188.815
million, or 19.7%, total average federal funds purchased,  repurchase agreements
and notes payable increased $18.176 million,  or 18.6%, and average Federal Home
Loan Bank advances and other borrowings increased $30.426 million, or 101.7%, in
2005 from 2004.  Included in the increase in average deposits was a shift in the
average  deposit mix in 2005 versus  2004.  There were  increases in four out of
five categories of deposits. Average time deposits increased $87.996 million, or
25.0%, average savings increased $81.717 million, or 23.6%, average non-interest
bearing  demand  deposits  increased  $32.069  million,  or 31.8%,  and  average
non-interest  bearing  savings  increased  $5.372  million,  or  8.1%.  Somewhat
offsetting  these  increases  in  average  deposits  was a  decrease  in average
interest bearing demand deposits of $18.339 million, or 19.7%.

                                       25
<PAGE>

Investment Securities

The carrying value of investments in debt and equity securities was as follows:

<TABLE>

                         Carrying Value of Securities(1)
                                 (in thousands)
December 31,                                    2005         2004         2003
--------------------------------------------------------------------------------
<S>                                           <C>          <C>          <C>
Securities available-for-sale:
  Federal agencies ......................     $312,484     $218,994     $220,199
  Mortgage-backed securities ............       13,657       27,713       23,007
  State and municipal ...................       13,834       16,715       17,317
  Marketable equity securities ..........        3,112        6,158        5,391
                                              ----------------------------------
         Total ..........................     $343,087     $269,580     $265,914
                                              ==================================
Securities held-to-maturity:
  Federal agencies ......................     $ 38,650     $ 40,931     $ 10,704
  Mortgage-backed securities ............       17,091       14,992       50,029
  State and municipal ...................       20,801       25,241       36,323
                                              ----------------------------------
         Total ..........................     $ 76,542     $ 81,164     $ 97,056
                                              ==================================
Non-marketable equity securities:
  FHLB and FRB stock(2) .................     $ 21,450     $  4,279     $  4,259
  Other equity investments ..............        3,544        3,703        3,497
                                              ----------------------------------
         Total ..........................     $ 24,994     $  7,982     $  7,756
                                              ----------------------------------
         Total securities ...............     $444,623     $358,726     $370,726
                                              ==================================

<FN>

     (1)  Investment  securities  available-for-sale  are carried at fair value.
          Investment securities held-to-maturity are carried at amortized cost.

     (2)  FHLB and FRB are commonly used acronyms for Federal Home Loan Bank and
          Federal Reserve Bank,  respectively.  All FRB stock was redeemed after
          the merger in November 2004.
</FN>

</TABLE>

The  unrealized  loss  on  securities  available-for-sale,  net of  tax  effect,
increased $1.379 million to a loss of $1.597 million at December 31, 2005 from a
loss of $218,000 at December 31, 2004.

                                       26
<PAGE>
The  following  table  shows  the  maturities  and  weighted-average  yields  of
investment securities at December 31, 2005:

<TABLE>
                                                       Maturities and Weighted Average Yields of Debt Securities
                                                                        (dollars in thousands)
                                                                          December 31, 2005
                                      -------------------------------------------------------------------------------------------
                                           1 year              1 to 5           5 to 10             Over
                                           or less             years             years            10 years         Total
                                        Amount   Rate      Amount   Rate     Amount   Rate     Amount  Rate    Amount    Rate
                                      -------------------------------------------------------------------------------------------
<S>                                   <C>        <C>     <C>        <C>    <C>        <C>    <C>       <C>    <C>        <C>
Securities available-for-sale:
  Federal agencies ................   $146,255   3.06%   $164,779   3.87%  $  1,450   4.72%  $    --     --%  $312,484   3.49%
  Mortgage-backed securities(1) ...      3,125   3.84%     10,016   4.46%       516   6.05%       --     --   $ 13,657   4.38%
  State and municipal (TE)(2) .....      3,638   5.07%      7,011   6.53%     2,711   7.59%      474   7.76%    13,834   6.40%
  Marketable equity securities(3) .         --    --           --     --         --     --        --     --      3,112     --
                                      -----------------------------------------------------------------------------------------
         Total ....................   $153,018           $181,806          $  4,677          $   474          $343,087
                                      =========================================================================================
Average Yield (TE)(2) .............              3.12%              4.01%             6.53%            7.76%             3.65%
                                      =========================================================================================
Securities held-to-maturity:
  Federal agencies ................   $ 11,344   2.63%   $ 22,581   3.04%  $  4,725   3.85%  $    --     --   $ 38,650   3.02%
  Mortgage-backed securities(1) ...      2,675   3.06%     10,614   4.60%       704   5.16%    3,098   5.50%    17,091   4.54%
  State and municipal (TE)(2) .....      9,475   5.21%     10,971   6.27%       195   7.31%      160   7.95%    20,801   5.81%
                                      -----------------------------------------------------------------------------------------
         Total ....................   $ 23,494           $ 44,166          $  5,624          $ 3,258          $ 76,542
                                      =========================================================================================
Average Yield (TE)(2) .............              3.72%              4.22%             4.13%            5.62%             4.12%
                                      =========================================================================================
Non-marketable equity securities(3)
  FHLB stock ......................         --     --          --     --         --     --        --     --   $ 21,450     --
  Other equity investments ........         --     --          --     --         --     --        --     --      3,544     --
                                      -----------------------------------------------------------------------------------------
         Total ....................   $     --     --    $     --     --   $     --     --   $    --     --   $ 24,994     --
                                      =========================================================================================
<FN>

     (1)  Expected  maturities may differ from  contractual  maturities  because
          borrowers  may have the  right to call or prepay  obligations  with or
          without call or prepayment  penalties and certain  securities  require
          principal repayments prior to maturity.
     (2)  The average yield has been tax equivalized (TE) on state and municipal
          tax-exempt securities.
     (3)  Due to the  nature  of  these  securities,  they do not  have a stated
          maturity date or rate.
</FN>

</TABLE>

                                       27
<PAGE>
Loans

The following tables present the amounts and percentages of loans at December 31
for the years indicated according to the categories of commercial, financial and
agricultural;  real estate commercial; real estate residential;  and installment
and consumer loans.

<TABLE>

                                                               Amount of Loans Outstanding
                                                                 (dollars in thousands)
                                               2005         2004         2003         2002         2001
                                           ---------------------------------------------------------------
<S>                                        <C>          <C>          <C>          <C>          <C>
Commercial, financial and agricultural..   $  319,861   $  314,657   $  249,795   $  234,045   $  246,042
Real Estate - Commercial ...............      469,506      309,830      298,075      265,970      209,950
Real Estate - Residential ..............      140,304       62,464       50,922       77,857      106,743
Installment and consumer ...............       86,728       83,926       77,253       95,529      119,585
                                           ---------------------------------------------------------------
     Total loans .......................   $1,016,399   $  770,877   $  676,045   $  673,401   $  682,320
                                           ==============================================================
</TABLE>

<TABLE>

                                                         Percentage of Loans Outstanding
                                                 2005       2004       2003       2002       2001
                                              ----------------------------------------------------
<S>                                             <C>        <C>        <C>        <C>        <C>
Commercial, financial and agricultural..        31.47%     40.82%     36.95%     34.75%     36.06%
Real Estate - Commercial ...............        46.19%     40.19%     44.09%     39.50%     30.77%
Real Estate - Residential ..............        13.81%      8.10%      7.53%     11.56%     15.64%
Installment and consumer ...............         8.53%     10.89%     11.43%     14.19%     17.53%
                                              ----------------------------------------------------
     Total .............................       100.00%    100.00%    100.00%    100.00%    100.00%
                                              ====================================================
</TABLE>

The Company's loan portfolio  totaled  approximately  $1.016 billion at December
31, 2005, representing 62.5% of total assets at that date. Total loans increased
$245.522  million,  or 31.8%,  from  December 31, 2004 to December 31, 2005 with
increases in  commercial,  financial and  agricultural  loans,  commercial  real
estate loans,  residential real estate loans, and installment and consumer loans
of $5.204 million, $159.676 million, $77.840 and $2.802 million, respectively.

Total loans  increased  $94.832  million,  or 14.0%,  from  December 31, 2003 to
December 31, 2004,  with  increases in  commercial,  financial and  agricultural
loans,  commercial  real  estate  loans,  residential  real  estate  loans,  and
installment  and consumer loans of $64.862  million,  $11.755  million,  $11.542
million and $6.673 million, respectively.

The balance of loans  outstanding as of December 31, 2005 by maturities is shown
in the following table:

<TABLE>

                                                                   Maturity of Loans Outstanding
                                                                       (dollars in thousands)
                                                        ----------------------------------------------------
                                                                        December 31, 2005
                                                        ----------------------------------------------------
                                                          1 year          1-5         Over 5
                                                          or less        years         years         Total
                                                        ----------------------------------------------------
<S>                                                     <C>           <C>           <C>           <C>
Commercial, financial and agricultural ..............   $  192,458    $   93,223    $   34,180    $  319,861
Real Estate - Commercial ............................      168,024       198,056       103,426    $  469,506
Real Estate - Residential ...........................       12,354        38,016        89,934    $  140,304
Installment and consumer ............................       24,175        38,761        23,792    $   86,728
                                                        ----------------------------------------------------
     Total ..........................................   $  397,011    $  368,056    $  251,332    $1,016,399
                                                        ====================================================
Percentage of total loans outstanding ...............       39.06%        36.21%        24.73%       100.00%
                                                        ====================================================
</TABLE>

As of December 31,  2005,  commercial,  financial  and  agricultural  loans with
maturities  of  greater  than one year were  comprised  of  $41.572  million  in
fixed-rate  loans and $85.831 million in  floating-rate  loans.  Commercial real
estate  loans with  maturities  greater  than one year at December 31, 2005 were
comprised  of  $66.673  million  in  fixed-rate  loans and  $234.809  million in
floating-rate loans.  Residential real estate loans with maturities greater than
one year at December 31, 2005 included  $52.804 million in fixed-rate  loans and
$75.146 million in floating-rate loans.

                                       28
<PAGE>


Allowance for Loan Losses and Loan Quality

The following table summarizes  changes in the allowance for loan losses by loan
categories for each period and additions to the allowance for loan losses, which
have been charged to operations.

<TABLE>

                                                                  Allowance for Loan Losses
                                                                    (dollars in thousands)
                                              -------------------------------------------------------------
                                                 2005        2004         2003         2002         2001
                                              -------------------------------------------------------------
<S>                                           <C>          <C>          <C>          <C>          <C>
Allowance for loan losses at
  beginning of year .......................   $  9,650     $  9,786     $  9,259     $  9,259     $  8,879
Allocation for loan losses attributable to
  acquisition of Citizens .................   $  3,434     $     --     $     --     $     --     $     --
                                              -------------------------------------------------------------
Charge-offs during period:
  Commercial, financial and agricultural ..   $   (552)    $   (288)    $   (148)    $    (55)    $ (1,165)
  Real Estate - Commercial ................         --           --           --          (48)          --
  Real Estate - Residential ...............        (64)         (48)         (42)        (125)         (27)
  Installment and consumer ................       (843)      (1,356)      (1,450)      (1,699)      (1,481)
                                              -------------------------------------------------------------
     Total ................................   $ (1,459)    $ (1,692)    $ (1,640)    $ (1,927)    $ (2,673)
                                              -------------------------------------------------------------
Recoveries of loans previously charged off:
  Commercial, financial and agricultural ..   $     34     $    214     $    452     $    245     $    179
  Real Estate - Commercial ................          5           --            2           --           --
  Real Estate - Residential ...............         --           15           46           31           37
  Installment and consumer ................        278          227          199          201          167
                                              -------------------------------------------------------------
     Total ................................   $    317     $    456     $    699     $    477     $    383
                                              -------------------------------------------------------------
          Net charge-offs .................   $ (1,142)    $ (1,236)    $   (941)    $ (1,450)    $ (2,290)
Provision for loan losses .................      1,530        1,100        1,470        1,450        2,670
                                              -------------------------------------------------------------
Allowance for loan losses at end of year ..   $ 13,472     $  9,650     $  9,788     $  9,259     $  9,259
                                              ============================================================
Ratio of net charge-offs to
  average net loans .......................       0.12%        0.17%        0.15%        0.22%        0.34%
                                              ============================================================
</TABLE>

Management  reviews  criteria  such  as the  customer's  historic  loan  payment
performance,  financial  statements,  financial  ratios,  cash flow,  net worth,
collateral and guaranties,  as well as local and national economic  factors,  in
determining  whether loans should be written off as  uncollectible.  The Company
records a loss if it is  probable  that a loss will  occur and the amount can be
reasonably estimated.

The  Company's  risk  of loan  loss  is  dependent  on  many  factors:  economic
conditions,  the  extent  and  values  of  underlying  collateral,   significant
concentrations  of loans within the  portfolio,  the ability and  willingness of
borrowers to perform  according to loan terms and  management's  competence  and
judgment in overseeing lending,  collecting and loan-monitoring  activities. The
risk of loss from commercial,  financial and agricultural loans is significantly
impacted  by  economic  factors  and how these  factors  affect  the  particular
industries  involved.  The risk of loss from  commercial  real  estate  loans is
impacted by the value of real estate,  which can  fluctuate  significantly  in a
short  period of time.  Additionally,  real estate  lending  typically  involves
higher  loan  principal  amounts and the  repayment  of the loans  generally  is
dependent,  in large part, on sufficient income from the properties securing the
loans to cover operating expenses and debt service.

An analysis of the  allowance for loan loss adequacy is performed on a quarterly
basis by the  Company's  credit  administration  department.  This  analysis  is
reported to executive  management  and  discussed at a quarterly  meeting  where
specific allocations for problem credits, charge-offs and monthly provisions for
loan losses are reviewed and revised, as necessary.  The results are reported to
the board of directors.  The analysis  includes  assessment of the allowance for
loan loss adequacy  based on historic loan losses and current  quality grades of
specific  credits  reviewed,  credit  concentrations,   current  delinquent  and
nonperforming  loans,  current economic  conditions,  peer group information and
results of recent audits or  regulatory  examinations.  Charged off  commercial,
financial  and  agricultural  loans in 2001  included two  agricultural  credits
totaling  $847,000.  The level of charge-offs of installment  and consumer loans
reported between 2001 and 2004 were reflective of the significant  growth of the
indirect  loan  portfolio  in  1999  and  2000.  The  level  of  charge-offs  of
installment and consumer loans decreased in 2005 compared to 2004 as a result of
a reduction in Owners Option indirect vehicle program  charge-offs from $415,000
in 2004 to $5,000 in 2005.

                                       29
<PAGE>

The  following  table shows the  allocation  of the allowance for loan losses to
each loan category.

<TABLE>

                                             Allocation of the Allowance for Loan Losses
                                                            (in thousands)
                                           -----------------------------------------------
                                             2005      2004      2003      2002      2001
                                           -----------------------------------------------
<S>                                        <C>       <C>       <C>       <C>       <C>
Allocated:
  Commercial, financial and agricultural   $ 4,433   $ 2,945   $ 2,540   $ 2,438   $ 2,333
  Real Estate - Commercial .............     5,991     3,981     3,433     3,294     3,154
  Real Estate - Residential ............       424       198       153       345       419
  Installment and consumer .............     1,447     1,605     2,428     1,763     2,000
                                           -----------------------------------------------
          Total allocated allowance ....   $12,295   $ 8,729   $ 8,554   $ 7,840   $ 7,906
Unallocated allowances .................     1,177       921     1,232     1,419     1,353
                                           -----------------------------------------------
          Total ........................   $13,472   $ 9,650   $ 9,786   $ 9,259   $ 9,259
                                           ===============================================
</TABLE>

The allocated  portion of the allowance for loan losses increased $3.566 million
from $8.729  million at December  31,  2004 to $12.295  million at December  31,
2005. Of this increase, the allowance for commercial, financial and agricultural
loans  increased  $1.488  million  from $2.945  million at December  31, 2004 to
$4.433  million  at  December  31,  2005.  The  allowance  for loan  losses  for
commercial  real estate loans  increased  $2.010  million from $3.981 million at
December 31, 2004 to $5.991  million at December 31, 2005,  which was reflective
of the increase in commercial  real estate loans in 2005  compared to 2004.  The
allowance for residential real estate loans increased  $226,000 from $198,000 at
December 31, 2004 to $424,000 at December 31, 2005.  Somewhat  offsetting  these
increases was a decrease in the allowance for  installment and consumer loans of
$158,000 from $1.605  million at December 31, 2004 to $1.447 million at December
31,  2005.  The portion of the  allowance  for loan losses that was  unallocated
increased  by $256,000 to $1.177  million at December  31, 2005 from  $921,000 a
year  earlier.  The  unallocated  amount  is  determined  based on  management's
judgment,   which  considers,  in  addition  to  the  other  factors  previously
discussed, the risk of error in the specific allocation.

Management   believes  that   nonperforming  and  potential  problem  loans  are
appropriately  identified  and monitored  based on the  extensive  loan analysis
performed by the credit administration  department, the internal loan committees
and the  board of  directors.  Historically,  there  has not been a  significant
amount of loans charged off which had not been previously  identified as problem
loans by the credit administration department or the loan committees.

The  following  table  presents the aggregate  amount of loans  considered to be
nonperforming  for the periods  indicated.  Nonperforming  loans  include  loans
accounted for on a nonaccrual basis,  accruing loans  contractually  past due 90
days or more as to interest or  principal  payments and loans which are troubled
debt  restructurings as defined in Statement of Financial  Accounting  Standards
No. 15, "Accounting by Debtors and Creditors for Troubled Debt Restructurings."

<TABLE>

                                                   Nonperforming Loans
                                                     (in thousands)
                                      ------------------------------------------
                                        2005     2004     2003     2002     2001
                                      ------------------------------------------
<S>                                   <C>      <C>      <C>      <C>      <C>
Nonaccrual loans(1) ...............   $2,234   $1,689   $  399   $1,392   $3,341
Loans past due 90 days or more ....   $  766   $  547   $  621   $  829   $1,774
Restructured loans ................   $  324   $  497   $   18   $   20   $   67

<FN>

     (1)  Includes $975,000,  $509,000, $269,000, $628,000 and $3.216 million at
          December 31, 2005, 2004, 2003, 2002 and 2001,  respectively,  of loans
          which  management  does  not  consider  impaired  as  defined  by  the
          Statement of Financial  Accounting  Standards No. 114,  "Accounting by
          Creditors for Impairments of a Loan" (SFAS 114).
</FN>
</TABLE>

                                       30
<PAGE>

<TABLE>

                                                 Other Nonperforming Assets
                                                      (in thousands)
                                         ---------------------------------------
                                          2005     2004     2003    2002    2001
                                         ---------------------------------------
<S>                                       <C>     <C>      <C>      <C>     <C>
Other real estate owed ...............    $188    $  --    $  --    $ 58    $ --
Nonperforming other assets ...........    $ 36    $  33    $  55    $ 94    $153

</TABLE>

There  were no other  interest  earning  assets  that  would be  required  to be
disclosed as being nonperforming if such other assets were loans.

At December  31,  2005,  the Company had $21.410  million in  potential  problem
loans,  excluding  nonperforming loans.  Potential problem loans are those loans
identified  by  management  as being worthy of special  attention,  and although
currently  performing,  may  have  some  underlying  weaknesses.  None of  these
potential  problem  loans were  considered  impaired as defined in SFAS 114. The
$21.410  million of potential  problem loans have either had timely  payments or
are  adequately  secured and loss of principal or interest is  determined  to be
unlikely.

Loans over 90 days past due,  which are not well  secured  and in the process of
collection,  are  placed on  nonaccrual  status.  There were  $2.234  million of
nonaccrual loans at December 31, 2005 compared to $1.689 million at December 31,
2004.   Included  in  nonaccrual   loans  at  December  31,  2005  was  $599,000
attributable  to one  commercial  loan.  As of  December  31,  2005,  a specific
valuation  allowance  of  $250,000  had  been  assigned  to this  loan,  and the
remaining balance was considered  adequately  collateralized.  Loans past due 90
days or more but still  accruing  interest  increased  by  $219,000 in 2005 to a
balance of $766,000 at December  31, 2005,  from  $547,000 at December 31, 2004.
These loans are well secured and in the process of collection.

The following table  categorizes  nonaccrual loans as of December 31, 2005 based
on levels of performance  and also details the allocation of interest  collected
during  the period in 2005 in which the loans  were on  nonaccrual.  Substantial
performance,  yet  contractually  past due,  includes  borrowers  making sizable
periodic  payments  relative to the required  periodic  payments due. A borrower
that is not making substantial payments but is making periodic payments would be
included in the limited performance category.

<TABLE>

                                                 Nonaccrual and Related Interest Payments
                                                             (in thousands)
                                         --------------------------------------------------------
                                                                Cash Interest Payments Applied As:
                                          At December 31, 2005 -----------------------------------
                                         --------------------             Recovery of   Reduction
                                            Book  Contractual  Interest  Prior Partial      of
                                          Balance   Balance     Income    Charge-offs   Principal
                                         --------------------------------------------------------
<S>                                      <C>        <C>        <C>         <C>           <C>
Not contractually past due ...........   $    179   $    179   $     16    $    --       $    1
Contractually past due with:
  Substantial performance ............         --         --         --         --           --
  Limited performance ................        411        411          6         --            8
  No performance .....................      1,644      1,649         --         --           --
                                         -------------------------------------------------------
Total ................................   $  2,234   $  2,239   $     22    $    --       $    9
                                         =======================================================
</TABLE>

The difference  between the book balance and the contractual  balance represents
charge-offs made since the loans were funded.

Management  believes that the allowance for loan losses at December 31, 2005 was
adequate  to  absorb  credit  losses in the total  loan  portfolio  and that the
policies and procedures in place to identify  potential  problem loans are being
effectively  implemented.  However, there can be no assurance that the allowance
for loan losses will be adequate to cover all losses.

Premises and Equipment

Total premises and equipment  increased $5.960 million,  or 34.9%,  from $17.087
million at  December  31,  2004 to $23.047  million at December  31,  2005.  The
increase included the acquisition of Citizens,  which contributed $5.993 million
and purchases of $2.516 million offset somewhat by depreciation and amortization
expense of $2.533  million,  loss on disposal of property of $8,000 and proceeds
from sale of property of $8,000.

                                       31
<PAGE>

Goodwill

Goodwill of $20.736  million at December 31, 2005, was due to the acquisition of
Citizens.

Core Deposit Intangibles

Core deposit intangibles of $4.569 million at December 31, 2005, were due to the
acquisition of Citizens.

Other Assets

Other assets increased $6.472 million,  or 34.8%, to $25.047 million at December
31,  2005  compared  to $18.575  million at  December  31,  2004.  The  Citizens
acquisition contributed $6.174 million to the increase in other assets.

Deposits

The  following  table shows the average  balance and  weighted  average  rate of
deposits at December 31 for the years indicated:

<TABLE>

                                                   Average Balance and Weighted Average Rate of Deposits
                                                                   (dollars in thousands)
                                           -------------------------------------------------------------------
                                                      2005                  2004                2003
                                           -------------------------------------------------------------------
                                                        Weighted              Weighted               Weighted
                                             Average     Average     Average   Average      Average   Average
                                             Balance      Rate       Balance    Rate        Balane      Rate
                                           -------------------------------------------------------------------
<S>                                        <C>            <C>     <C>           <C>       <C>            <C>
Demand
  Non-interest bearing .................   $  132,982       --    $  100,913      --      $   89,935       --
  Interest bearing .....................       74,976     0.57%       93,315    0.68%         87,351     0.73%
Savings
  Non-interest bearing .................       71,535       --        66,163      --          62,056       --
  Interest bearing .....................      427,341     1.76%      345,624    0.99%        284,641     0.91%
Time
  $100,000 and more ....................      126,344     3.17%      111,317    2.64%        113,604     3.22%
  Under $100,000 .......................      314,248     3.06%      241,279    2.89%        224,133     3.21%
                                           -------------------------------------------------------------------
      Totals ...........................   $1,147,426             $  958,611             $   861,720
                                           ===================================================================
</TABLE>

In analyzing  its deposit  activity,  management  has noted that  average  total
deposits increased  $188.815 million,  or 19.7%,  during 2005.  Included in this
increase were shifts in the average deposit mix in 2005 versus 2004.  There were
increases in average non-interest bearing deposits of $32.069 million, or 31.8%,
average  non-interest  bearing  savings  deposits  of $5.372  million,  or 8.1%,
average interest bearing savings deposits of $81.717 million, or 23.6%,  average
time  deposits of $100,000 and more of $15.027  million,  or 13.5%,  and average
time deposits under $100,000 of $72.969 million,  or 30.2%.  Slightly offsetting
these increases in average  deposits was a decrease in average  interest bearing
demand deposits of $18.339 million, or 19.7%.

The table below sets forth the maturity of time  deposits  greater than $100,000
at December 31, 2005:

<TABLE>

                         Maturity of Time Deposits of $100,000 or More
                                         (in thousands)
----------------------------------------------------------------------------------------------------
                                                                                        Total Time
                                  State of Illinois  Brokered                          Deposits of
Maturity at December 31, 2005:      Time Deposits       CDs        CDs       IRAs   $100,000 or More
----------------------------------------------------------------------------------------------------
<C>                                 <C>             <C>        <C>        <C>           <C>
3 months or less .............      $     3,070     $     --   $ 27,524   $    900      $ 31,494
3 to 6 months ................               --           --     17,511        473        17,984
6 to 12 months ...............            5,000        1,477     30,957      1,557        38,991
Over 12 months ...............              575           --     36,332      4,827        41,734
                                    ------------------------------------------------------------
        Total ................      $     8,645     $  1,477   $112,324   $  7,757      $130,203
                                    ============================================================
</TABLE>

                                       32
<PAGE>

Federal Funds Purchased, Repurchase Agreements and Notes Payable

This category  includes federal funds purchased,  which are generally  overnight
transactions and securities sold under repurchase agreements,  which mature from
one day to three  years from the date of sale.  The table in note 8 in the Notes
to  Consolidated  Financial  Statements  shows the  balances  of  federal  funds
purchased and  repurchase  agreements at December 31, 2005 and 2004, the average
balance for the years ended  December 31, 2005,  2004 and 2003,  and the maximum
month-end value during each year.

Fair Values of Financial Instruments

The estimated  fair values of financial  instruments  for which no listed market
exists and the fair values of investment  securities,  which are based on listed
market  quotes at December  31, 2005 and 2004,  are  disclosed in note 17 in the
Notes to Consolidated Financial Statements.

Capital

Total  shareholders'  equity increased  $29.794 million from $113.975 million at
December  31,  2004 to  $143.769  million at December  31,  2005.  Net income of
$18.308  million  and an  increase  of $27.804  million  due to the  issuance of
treasury  stock for the  acquisition of Citizens,  were offset  somewhat by cash
dividends  declared of $8.926 million,  a decrease of $6.013 million as a result
of  net  treasury  stock  transactions,  and a  decrease  in  accumulated  other
comprehensive income of $1.379 million.

Financial  institutions are required by regulatory  agencies to maintain minimum
levels of capital based on asset size and risk characteristics.  Currently,  the
Company  and the Bank are  required  by their  primary  regulators  to  maintain
adequate capital based on two measurements:  the total assets leverage ratio and
the risk-weighted assets ratio.

Based on  Federal  Reserve  guidelines,  a bank  holding  company  generally  is
required to  maintain a leverage  ratio of 3% plus an  additional  cushion of at
least 100 to 200 basis points. The Company's total assets leverage ratio at both
December 31, 2005 and 2004 was 7.8% and 9.2%,  respectively.  The leverage ratio
for the Bank is disclosed in note 19 in the Notes to the Consolidated  Financial
Statements and is well above the regulatory minimum.

The minimum  risk-weighted  assets ratio for bank  holding  companies is 8%. The
Company's  total  risk-weighted  assets ratio at both December 31, 2005 and 2004
was 11.7% and 13.3%,  respectively  -  significantly  higher than the regulatory
minimum.  The Bank's total risk-weighted assets ratio is disclosed in note 19 in
the Notes to the Consolidated  Financial  Statements and is significantly higher
than the regulatory minimum.

Inflation and Changing Prices

Changes  in  interest  rates  and a bank's  ability  to react to  interest  rate
fluctuations have a much greater impact on a bank's balance sheet and net income
than inflation. A review of net interest income,  liquidity and rate sensitivity
should  assist in the  understanding  of how well the Company is  positioned  to
react to changes in interest rates.

Liquidity and Cash Flows

The Company  requires  cash to fund loan growth and  deposit  withdrawals.  Cash
flows  fluctuate  with changes in economic  conditions,  current  interest  rate
trends and as a result of management strategies and programs. In general,  funds
provided by customer deposits,  federal funds purchased,  repurchase  agreements
and notes payable, and maturities,  calls and paydowns of investment  securities
are used to fund loans and purchase investment  securities.  Available funds are
used to fund demand for loans that meet the Company's credit quality guidelines,
with the remaining funds used to purchase  investment  securities and/or federal
funds sold. The Company monitors the demand for cash and initiates  programs and
policies as considered necessary to meet funding gaps.

                                       33
<PAGE>

The Company was able to adequately  fund loan demand and meet liquidity needs in
2005. A review of the  consolidated  statement of cash flows in the accompanying
financial  statements  shows  that  the  Company's  cash  and  cash  equivalents
increased  $29.138  million from  December  31, 2004 to December  31, 2005.  The
increase  in 2005  resulted  from  cash  provided  by  financing  and  operating
activities,  offset  somewhat by cash used in investing  activities.  There were
differences  in sources  and uses of cash during  2005  compared  to 2004.  Cash
provided by financing  activities  during 2005 was $76.079  million  compared to
$59.981 million during the same period in 2004,  primarily due to an increase in
federal funds purchased,  repurchase agreements and notes payable during 2005 of
$21.552  million,  mainly as a result of an  increase in  repurchase  agreements
compared to a decrease of $6.098 million in federal funds purchased,  repurchase
agreements  and notes payable  during the same period in 2004 primarily due to a
decrease in  repurchase  agreements.  Less cash was  provided by deposit  growth
during  2005  compared  to  2004  at the  Company's  Main  Street  Bank &  Trust
subsidiary.  The Company expected  deposits to decrease during the first half of
2005  due to a  planned  outflow  of  short-term  deposits  attributable  to the
Company's Wealth Management  division which had grown  approximately $43 million
during the second half of 2004.  More cash was used in 2005 for  treasury  stock
transactions  compared to 2004. Cash provided by Federal Home Loan Bank advances
and other  borrowings of $39.000 million during 2005 was used mainly as a source
of working capital and $39.095 million was repaid during the year. More cash was
provided by operating  activities in 2005  compared to 2004  primarily due to an
increase in net income.

Less cash was used by  investing  activities  during  2005  compared to the same
period in 2004,  primarily due to  differences in investments in debt and equity
securities and volume of loan growth.  Cash used by investing  activities during
2005 was $47.272 million  compared to cash provided of $6.702 million during the
same period in 2004. In 2005,  cash used to purchase debt and equity  securities
of $335.505  million was  somewhat  offset by proceeds of $288.233  million from
maturities, calls and sales of debt and equity securities, principal paydowns on
mortgage-backed  securities and return of equity on other equity securities.  In
2004, proceeds of $275.371 million from maturities,  calls and sales of debt and
equity securities,  principal paydowns on mortgage-backed securities,  return of
equity on other equity securities and proceeds from redemption of non-marketable
equity  securities were offset somewhat by cash used to purchase debt and equity
securities of $268.669 million. Also contributing to the difference in investing
activities was the difference in loan growth during these two periods. Cash used
to fund loan growth during 2005 was $15.116 million  compared to $96.108 million
during the same period in 2004. In addition, $6.385 million was used to fund the
acquisition of Citizens in 2005.

On April 1, 2005, the Company  borrowed  $6.000  million,  to be repaid within 3
years,  to fund a portion of the Citizens  acquisition  cost.  In addition,  the
Company  negotiated  an increase of its  $10.000  million  line of credit from a
third party lender to $15.000 million and  immediately  advanced $4.000 million.
At December 31, 2005, the Company had $1.500 million  outstanding on its $15.000
million line of credit which was repaid in January 2006.  The  Company's  future
short-term cash requirements are expected to be provided by maturities and sales
of investments,  sales of loans and deposits.  Cash required to meet longer-term
liquidity  requirements  will mostly  depend on future goals and  strategies  of
manag%ment,  the competitive  environment,  economic  factors and changes in the
needs of customers.  If current sources of liquidity  cannot provide needed cash
in the future,  the Company can obtain  long-term  funds from  several  sources,
including, but not limited to, utilizing the Company's remaining $13.500 million
line of credit from a third party lender,  FHLB  borrowings and brokered CDs. To
meet  short-term  liquidity  needs,  the  Company  is able to borrow  funds on a
temporary basis from the Federal Reserve Bank, the FHLB and correspondent banks.
With sound capital  levels,  the Company  continues to have several  options for
longer-term cash needs, such as for future expansion and acquisitions.

Management is not aware of any current  recommendations by the Company's primary
regulators  which if implemented  would have a material  effect on the Company's
liquidity, capital resources or operations.

                                       34
<PAGE>

The following table summarizes significant  obligations and other commitments at
December 31, 2005 (in thousands):
<TABLE>
                                                  FHLB and Other  Operating
Years Ended December 31,            Time Deposits  borrowings(1)    Leases        Total
-----------------------------------------------------------------------------------------
<C>                                   <C>           <C>           <C>            <C>
2006 .............................    $330,335      $ 29,910      $     266      $360,511
2007 .............................      84,915         2,453            189      $ 87,557
2008 .............................      35,000        35,023             16      $ 70,039
2009 .............................      13,810            --             12      $ 13,822
2010 .............................      10,382            --              9      $ 10,391
Thereafter .......................          15            --             --      $     15
                                      ---------------------------------------------------
Total ............................    $474,457      $ 67,386      $     492      $542,335
                                      ===================================================
Commitments to extend credit:
Commitments ......................                                               $279,647
Standby letters of credit ........                                                 34,512

<FN>
     (1)  Fixed rate  callable FHLB advances are included in the period of their
          modified  duration  rather  than in the  period in which they are due.
          FHLB and other  borrowings  include  fixed rate  callable  advances of
          $24.000 million maturing in fiscal year 2008.
</FN>

</TABLE>

Interest Rate Sensitivity

The concept of interest  sensitivity attempts to gauge exposure of the Company's
net  interest  income to adverse  changes  in market  driven  interest  rates by
measuring  the  amount  of  interest-sensitive   assets  and  interest-sensitive
liabilities  maturing or subject to  repricing  within a specified  time period.
Liquidity  represents the ability of the Company to meet the day-to-day  demands
of deposit customers balanced by its investments of these deposits.  The Company
must also be prepared to fulfill  the needs of credit  customers  for loans with
various  types of  maturities  and  other  financing  arrangements.  One way the
Company  monitors its interest rate sensitivity and liquidity is through the use
of  static  gap  reports,  which  measure  the  difference  between  assets  and
liabilities maturing or repricing within specified time periods.


                                       35
<PAGE>


The following table shows the Company's  interest rate  sensitivity  position at
various intervals at December 31, 2005:
<TABLE>

                                                     Rate Sensitivity of Earning Assets and Interest Bearing Liabilities
                                                                              (in thousands)
                                                    -----------------------------------------------------------------------
                                                      1 - 30     31 - 90     91 - 180    181 - 365      Over
                                                       Days        Days        Days        Days        1 year       Total
                                                    -----------------------------------------------------------------------
<S>                                                 <C>          <C>         <C>          <C>        <C>         <C>
Interest earning assets:
  Federal funds sold and interest bearing deposits  $  42,059    $     --    $     --     $     --   $      --   $   42,059
  Debt and equity securities(1)                        23,101       4,350      36,901       60,043     320,228      444,623
  Loans(2)                                            346,663      55,395      51,134       97,072     467,796    1,018,060
                                                    -----------------------------------------------------------------------
          Total interest earning assets             $ 411,823    $ 59,745    $ 88,035     $157,115   $ 788,024   $1,504,742
                                                    -----------------------------------------------------------------------
Interest bearing liabilities:
  Savings and interest bearing demand deposits      $  63,750    $  1,700     $ 2,550     $  8,697   $ 190,168   $  266,865
  Money market savings deposits                       293,828          --          --           --          --      293,828
  Time deposits                                        38,913      63,227      66,121      162,045     144,150      474,456
  Federal funds purchased, repurchase agreements
    and notes payable                                  96,314       7,759       5,156        9,223           -      118,452
  FHLB Advances and other borrowings                   15,575      34,069          75       10,150       7,517       67,386
                                                    -----------------------------------------------------------------------
          Total interest bearing liabilities        $ 508,380   $ 106,755    $ 73,902     $190,115   $ 341,835   $1,220,987
                                                    =======================================================================
Net asset (liability) funding gap                   $ (96,557)  $ (47,010)   $ 14,133    $ (33,000)  $ 446,189    $ 283,755
                                                    -----------------------------------------------------------------------
Repricing gap                                            0.81        0.56        1.19         0.83        2.31         1.23
Cumulative repricing gap                                 0.81        0.77        0.81         0.82        1.23         1.23
                                                    =======================================================================
<FN>
     (1)  Debt and equity securities include securities available-for-sale.
     (2)  Loans include mortgage loans held-for-sale.
</FN>
</TABLE>

                                       36
<PAGE>

Included  in the 1-30 day  category  of  savings  and  interest  bearing  demand
deposits is non-core  deposits plus a percentage,  based upon  industry-accepted
assumptions,  of the core  deposits.  "Core  deposits"  are the  lowest  average
balance  of the prior  twelve  months for each  product  type  included  in this
category. "Non-core deposits" are the difference between the current balance and
core   deposits.   The  time   frames   include   a   percentage,   based   upon
industry-accepted assumptions, of the core deposits as follows:

<TABLE>

                                                     1-30      31-90      91-180    181-365      Over
                                                     Days       Days       Days       Days      1 Year
                                                   ----------------------------------------------------
<S>                                                  <C>        <C>        <C>        <C>        <C>
Savings and interest bearing
   demand deposits ............................      0.45%      0.85%      1.25%      2.45%      95.00%

</TABLE>

At December 31, 2005, the Company tended to be somewhat liability  sensitive due
to the levels of savings and interest  bearing demand  deposits,  time deposits,
federal funds purchased,  repurchase  agreements and notes payable. As such, the
effect of a decrease in the prime rate of 100 basis  points  would  increase net
interest  income by  approximately  $966,000 in 30 days and $1.436 million in 90
days assuming no management  intervention.  A rise in interest  rates would have
the opposite  effect for the same  periods.  The  Company's  Asset and Liability
Management  Policy states that the  cumulative  ratio of  rate-sensitive  assets
("RSA") to rate-sensitive liabilities "(RSL") for the 12-month period shall fall
within the range of 0.75-1.25.  As of December 31, 2005,  the Company's  RSA/RSL
was 0.82, which was within the established guidelines.

In addition to managing  interest  sensitivity and liquidity  through the use of
gap reports,  the Company has provided for emergency  liquidity  situations with
informal agreements with correspondent banks, which permit the Company to borrow
federal funds on an unsecured basis. The Company has a $15.000 million unsecured
line of credit with a correspondent bank, of which $13.500 million was available
at  December  31,  2005.  Additionally,  the Company  has  sufficient  borrowing
capacity to permit it to borrow additional funds from the Federal Home Loan Bank
on a secured basis.

The Company uses financial  forecasting/budgeting/reporting software packages to
perform  interest  rate  sensitivity  analysis for all product  categories.  The
Company's  primary  focus of its  analysis  is on the  effect of  interest  rate
increases and decreases on net interest  income.  Management  believes that this
analysis  reflects the  potential  effects on current  earnings of interest rate
changes.  Call criteria and prepayment  assumptions are taken into consideration
for investments in debt and equity  securities.  All of the Company's  financial
instruments  are analyzed by a software  database,  which  includes  each of the
different  product  categories,  which  are  tied to key  rates  such as  prime,
Treasury  Bills,  or the federal funds rate.  The  relationships  of each of the
different  products to the key rate that the product is tied to is proportional.
The software reprices the products based on current offering rates. The software
performs interest rate sensitivity analysis by performing rate shocks of plus or
minus 200 basis points in 100 basis point increments.

The following  table shows  projected  results at December 31, 2005 and December
31,  2004 of the  impact on net  interest  income  from an  immediate  change in
interest  rates.  The results are shown as a  percentage  change in net interest
income over the next twelve months.

<TABLE>

                                             +200    +100   -100    -200
<S>                                          <C>     <C>   <C>      <C>
December 31, 2005 ......................      8.9%   4.7%  (4.7%)   (9.4%)
December 31, 2004 ......................     10.3%   5.1%  (5.1%)  (10.3%)

</TABLE>


The foregoing computations are based on numerous assumptions, including relative
levels of market  interest  rates,  prepayments  and deposit  mix.  The computed
estimates  should not be relied upon as a projection of actual results.  Despite
the  limitations  on  preciseness  inherent  in these  computations,  management
believes that the information provided is reasonably indicative of the effect of
changes in interest  rate levels on the net  earning  capacity of the  Company's
current  mix of  interest  earning  assets  and  interest  bearing  liabilities.
Management  continues to use the results of these  computations,  along with the
results of its computer model projections, in order to maximize current earnings
while  positioning  the Company to minimize  the effect of a prolonged  shift in
interest rates that would adversely affect future results of operations.

At the present time, the most  significant  market risk affecting the Company is
interest rate risk.  Other market risks such as foreign  currency  exchange risk
and commodity price risk do not occur in the normal business of the Company. The
Company also is not currently using trading activities or derivative instruments
to control interest rate risk.

                                       37
<PAGE>

Emerging Accounting Standards

In December 2004, the Financial  Accounting  Standards Board published Statement
No. 123 (revised 2004),  Share-Based Payment ("FAS 123(R)"). FAS 123(R) requires
that  the  compensation  cost  relating  to  share-based  payment  transactions,
including  grants of employee  stock  options and shares  under  employee  stock
purchase  plans,  be  recognized  in  financial  statements.  That  cost will be
measured based on the fair value of the equity or liability  instruments issued.
FAS 123(R) permits entities to use any option-pricing  model that meets the fair
value objectives in the Statement. The Statement was originally effective at the
beginning of the  Company's  third quarter in 2005,  however,  in April 2005 the
adoption of a new rule, by the Securities and Exchange  Commission,  changed the
dates for  compliance  with this  standard.  The Company will now be required to
implement Statement No. 123(R) beginning January 1, 2006.

As of the  effective  date,  the Company  will have the option of  applying  the
Statement using the modified prospective application or a modified retrospective
application. Under the prospective method, compensation cost would be recognized
for (1) all awards  granted  after the  required  effective  date and for awards
modified,  cancelled or repurchased after that date and (2) the portion of prior
awards for which the requisite  service has not yet been rendered,  based on the
grant-date fair value of those awards calculated for pro forma disclosures under
SFAS 123. Under the retrospective application method, compensation cost would be
recognized  as in (1)  above  and  (2)  for  prior  periods  would  be  restated
consistent  with the pro forma  disclosures  required for those  periods by SFAS
123. The valuation model and amortization  assumption we have used will continue
to be used.

The impact of this  Statement on the Company after the effective date and beyond
will  depend  upon  various  factors,  among them being the future  compensation
strategy.  The pro forma  compensation costs presented in Note 1 in the Notes to
Consolidated Financial Statements and in prior filings for the Company have been
calculated  using  the  Black-Scholes  option  pricing  model  and  may  not  be
indicative of amounts which should be expected in future periods.

In May  2005,  the FASB  issued  SFAS No.  154,  Accounting  Changes  and  Error
Corrections,  which  provides  guidance on the  accounting  for and reporting of
accounting changes and error corrections. It establishes,  unless impracticable,
retrospective  application  as the  required  method for  reporting  a change in
accounting principle in the absence of explicit transition requirements specific
to the newly adopted accounting  principle.  The reporting of a correction of an
error by restating  previously issued financial  statements is also addressed by
this statement. SFAS No. 154 is effective for accounting changes and corrections
of errors made in fiscal years  beginning  after  December 15, 2005.  Management
does not  believe  that  this  statement  will  have a  material  impact  on the
Company's financial statements.

On February 8, 2006,  President Bush signed the Federal Deposit Insurance Reform
Act of 2005 ("FDIRA") into law as part of the Deficit  Reduction Act of 2005 and
on  February  15,  2006,  President  Bush  signed  into  law the  technical  and
conforming   amendments   designed  to  implement  FDIRA.   FDIRA  provides  for
legislative reforms to modernize the federal deposit insurance system.

Among other  things,  FDIRA:  (i) merges the BIF and the SAIF of the FDIC into a
new Deposit  Insurance Fund (the "DIF");  (ii) allows the FDIC,  after March 31,
2010, to increase deposit insurance  coverage by an adjustment for inflation and
requires the FDIC's Board of  Directors,  not later than April 1, 2010 and every
five years thereafter, to consider whether such an increase is warranted;  (iii)
increases the deposit insurance limit for certain employee benefit plan deposits
from $100,000 to $250,000,  subject to adjustments for inflation after March 31,
2010, and provides for pass-through  insurance coverage for such deposits;  (iv)
increases the deposit  insurance limit for certain  retirement  account deposits
from $100,000 to $250,000,  subject to adjustments for inflation after March 31,
2010; (v) allows the FDIC's Board of Directors to set deposit  insurance premium
assessments in any amount the Board of Directors deems necessary or appropriate,
after taking into account various factors  specified in FDIRA; (vi) replaces the
fixed  designated  reserve  ratio  of  1.25%  with  a  reserve  ratio  range  of
1.15%-1.50%,  with the specific  reserve ratio to be determined  annually by the
FDIC by regulation;  (vii) permits the FDIC to revise the risk-based  assessment
system by regulation;  (viii) requires the FDIC, at the end of any year in which
the reserve  ratio of the DIF exceeds 1.5% of  estimated  insured  deposits,  to
declare a dividend payable to insured depository institutions in an amount equal
to 100% of the  amount  held by the DIF in excess  of the  amount  necessary  to
maintain the DIF's  reserve  ratio at 1.5% of estimated  insured  deposits or to
declare a dividend equal to 50% of the amount in excess of the amount  necessary
to  maintain  the  reserve  ratio  at  1.35% if the  reserve  ratio  is  between
1.35%-1.50% of estimated insured  deposits;  and (ix) provides a one-time credit
based upon the assessment  base of the  institution on December 31, 1996 to each
insured depository institution that was in existence as of December 31, 1996 and
paid a deposit  insurance  assessment  prior to that date (or a successor to any
such institution).

                                       38
<PAGE>

The  merger of the BIF and SAIF takes  effect no later than July 1, 2006,  while
the  remaining  provisions  are  not  effective  until  the  FDIC  issues  final
regulations.  FDIRA  requires the FDIC to issue final  regulations no later than
270 days after  enactment:  (i) designating a reserve ratio;  (ii)  implementing
increases  in  deposit  insurance  coverage;  (iii)  implementing  the  dividend
requirement; (iv) implementing the one-time assessment credit; and (v) providing
for assessments in accordance with FDIRA.

Safe Harbor Statement Under the Private Securities Litigation Reform Act of 1995

This document (including  information  incorporated by reference) contains,  and
future  oral and  written  statements  of the  Company  and its  management  may
contain,  forward-looking  statements,  within  the  meaning of such term in the
Private Securities  Litigation Reform Act of 1995, with respect to the financial
condition,  results of operations,  plans,  objectives,  future  performance and
business of the  Company.  Forward-looking  statements,  which may be based upon
beliefs,  expectations  and  assumptions  of  the  Company's  management  and on
information currently available to management, are generally identifiable by the
use of  words  such as  "believe,"  "expect,"  "anticipate,"  "plan,"  "intend,"
"estimate,"   "may,"  "will,"  "would,"   "could,"  "should"  or  other  similar
expressions.   Additionally,   all  statements  in  this   document,   including
forward-looking  statements,  speak  only as of the date they are made,  and the
Company  undertakes  no  obligation  to  update  any  statement  in light of new
information or future events.

The Company's ability to predict results or the actual effect of future plans or
strategies is  inherently  uncertain.  The factors,  which could have a material
adverse  effect on the  operations  and future  prospects of the Company and its
subsidiaries  are detailed in the "Risk Factors" section included under Item 1A.
of Part I of this Form 10-K.  In addition to the risk factors  described in that
section,  there are other factors that may impact any public company,  including
ours,  which could have a material  adverse  effect on the operations and future
prospects of the Company and its subsidiaries. These additional factors include,
but are not limited to, the following:

     o    The economic impact of past and any future terrorist attacks,  acts of
          war or threats  thereof and the  response of the United  States to any
          such threats and attacks.

     o    The costs, effects and outcomes of existing or future litigation.

     o    Changes in  accounting  policies and  practices,  as may be adopted by
          state  and  federal  regulatory  agencies,  the  Financial  Accounting
          Standards Board, the Securities and Exchange Commission and the Public
          Company Accounting Oversight Board.

     o    The  ability of the  Company to manage the risks  associated  with the
          foregoing as well as anticipated.

These risks and uncertainties should be considered in evaluating forward-looking
statements and undue reliance should not be placed on such statements.

Item 7a. Quantitative and Qualitative Disclosures about Market Risk

See the "Interest Rate  Sensitivity"  section  contained in Item 7, Management's
Discussion and Analysis of Financial Condition and Results of Operations.

Item 8.  Financial Statements and Supplementary Data

The financial statements begin on page 40.

                                       39
<PAGE>





                             MAIN STREET TRUST, INC.
                                AND SUBSIDIARIES

                        Consolidated Financial Statements

                        December 31, 2005, 2004 and 2003


                                       40
<PAGE>






                             MAIN STREET TRUST, INC.
                                AND SUBSIDIARIES




                                TABLE OF CONTENTS





REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM ..................  42



CONSOLIDATED FINANCIAL STATEMENTS

Consolidated Balance Sheets .............................................   43

Consolidated Statements of Income .......................................   44

Consolidated Statements of Changes in Shareholders' Equity ..............   45

Consolidated Statements of Cash Flows ................................... 46-47

Notes to Consolidated Financial Statements .............................. 48-70



                                       41
<PAGE>

McGladrey & Pullen, LLP
Certified Public Accountants


             Report of Independent Registered Public Accounting Firm



The Board of Directors
Main Street Trust, Inc.
Champaign, Illinois

We have  audited the  accompanying  consolidated  balance  sheets of Main Street
Trust,  Inc. and  subsidiaries as of December 31, 2005 and 2004, and the related
consolidated  statements of income,  changes in shareholders'  equity,  and cash
flows for each of the three years in the period ended  December 31, 2005.  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 the standards of the Public  Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement.  An audit includes examining, on a
test basis,  evidence  supporting  the amounts and  disclosures in the 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 Main
Street Trust,  Inc. and  subsidiaries  as of December 31, 2005 and 2004, and the
results of their  operations and their cash flows for each of the three years in
the period ended  December 31, 2005, in conformity  with  accounting  principles
generally accepted in the United States of America.

We also have audited,  in  accordance  with  standards of the Public  Accounting
Oversight Board (United States),  the  effectiveness of Main Street Trust,  Inc.
and subsidiaries'  internal control over financial  reporting as of December 31,
2005 based on  criteria  established  in Internal  Control-Integrated  Framework
issued by the Committee of Sponsoring  Organizations of the Treadway  Commission
(COSO) and our report dated March 7, 2006  expressed an  unqualified  opinion on
management's  assessment of the  effectiveness  of Main Street  Trust,  Inc. and
subsidiaries'  internal  control over  financial  reporting  and an  unqualified
opinion on the  effectiveness  of Main  Street  Trust,  Inc.  and  subsidiaries'
internal control over financial reporting.


/s/ McGladrey & Pullen, LLP

Champaign, Illinois
March 7, 2006


McGladrey & Pullen, LLP is a member firm of RSM International -
an affiliation of separate and independent legal rights

                                       42
<PAGE>

                             MAIN STREET TRUST, INC.
                                AND SUBSIDIARIES

                           Consolidated Balance Sheets

                           December 31, 2005 and 2004
                        (in thousands, except share data)
<TABLE>

                                                                         2005           2004
                                                                     --------------------------
<S>                                                                  <C>            <C>
Assets
Cash and due from banks ..........................................   $    52,007    $    33,133
Federal funds sold and interest bearing deposits .................        42,059         31,795
                                                                     --------------------------
     Cash and cash equivalents ...................................        94,066         64,928
                                                                     --------------------------
Investments in debt and equity securities:
  Available-for-sale, at fair value ..............................       343,087        269,580
  Held-to-maturity, at cost (fair value of $75,665 and $81,099
    at December 31, 2005 and 2004, respectively) .................        76,542         81,164
  Non-marketable equity securities ...............................        24,994          7,982
                                                                     --------------------------
      Total investments in debt and equity securities ............       444,623        358,726
                                                                     --------------------------
Loans, net of allowance for loan losses of $13,472 and $9,650
  at December 31, 2005 and 2004, respectively ....................     1,002,927        761,227
Mortgage loans held for sale .....................................         1,661          1,005
Premises and equipment ...........................................        23,047         17,087
Goodwill .........................................................        20,736             --
Core deposit intangibles .........................................         4,569             --
Accrued interest receivable ......................................         8,461          6,570
Other assets .....................................................        25,047         18,575
                                                                     --------------------------
     Total assets ................................................   $ 1,625,137    $ 1,228,118
                                                                     ===========================

Liabilities and Shareholders' Equity
Liabilities:
  Deposits:
    Non-interest bearing .........................................   $   240,823    $   172,908
    Interest bearing .............................................     1,035,149        801,669
                                                                     --------------------------
     Total deposits ..............................................     1,275,972        974,577

  Federal funds purchased, repurchase agreements and notes payable       118,452         96,900
  Federal Home Loan Bank advances and other borrowings ...........        67,386         29,882
  Accrued interest payable .......................................         4,657          2,601
  Other liabilities ..............................................        14,901         10,183
                                                                     --------------------------
     Total liabilities ...........................................     1,481,368      1,114,143
                                                                     --------------------------

Commitments and Contingencies (Notes 17 and 18)

Shareholders' equity:
  Preferred stock, no par value;  2,000,000 shares authorized ....            --             --
  Common stock, $0.01 par value; 15,000,000 shares authorized;
    11,219,319 shares issued .....................................           112            112
  Paid in capital ................................................        55,189         55,189
  Retained earnings ..............................................       120,238        108,071
  Accumulated other comprehensive loss ...........................        (1,597)          (218)
                                                                     --------------------------
                                                                         173,942        163,154
  Less:  treasury stock, at cost, 1,072,644 and 1,770,329 shares
    at December 31, 2005 and  2004, respectively .................       (30,173)       (49,179)
                                                                     --------------------------
     Total shareholders' equity ..................................       143,769        113,975
                                                                     --------------------------
     Total liabilities and shareholders' equity ..................   $ 1,625,137    $ 1,228,118
                                                                     ==========================
</TABLE>

See accompanying notes to consolidated financial statements.

                                       43
<PAGE>


                             MAIN STREET TRUST, INC.
                                AND SUBSIDIARIES

                        Consolidated Statements of Income

                  Years Ended December 31, 2005, 2004 and 2003
                 (in thousands, except share and per share data)
<TABLE>
                                                                          2005           2004           2003
                                                                     -------------------------------------------
<S>                                                                  <C>             <C>            <C>
Interest income:
  Loans and fees on loans ........................................   $     60,988    $     41,568   $     41,467
  Investments in debt and equity securities
   Taxable .......................................................         12,465          10,793         11,502
   Tax-exempt ....................................................          1,516           1,844          2,270
  Federal funds sold and interest bearing deposits ...............          2,023             600            447
                                                                     --------------------------------------------
     Total interest income .......................................         76,992          54,805         55,686

Interest expense:
  Deposits .......................................................         21,589          13,972         14,070
  Federal funds purchased, repurchase agreements and notes payable          3,097           1,271          1,094
  Federal Home Loan Bank advances and other borrowings ...........          2,793           1,609          1,559
                                                                     --------------------------------------------
     Total interest expense ......................................         27,479          16,852         16,723
                                                                     --------------------------------------------

     Net interest income .........................................         49,513          37,953         38,963
Provision for loan losses ........................................          1,530           1,100          1,470
                                                                     --------------------------------------------
     Net interest income after provision for loan losses .........         47,983          36,853         37,493

Non-interest income:
  Remittance processing ..........................................          6,748           7,201          7,211
  Trust and brokerage fees .......................................          7,599           6,492          5,783
  Service charges on deposit accounts ............................          2,923           2,419          2,545
  Securities transactions, net ...................................           (586)            133            (12)
  Gain on sales of mortgage loans, net ...........................            886             997          2,536
  Other ..........................................................          2,907           2,605          2,231
                                                                     --------------------------------------------
     Total non-interest income ...................................         20,477          19,847         20,294

Non-interest expense:
  Salaries and employee benefits .................................         23,099          18,889         18,245
  Occupancy ......................................................          3,074           2,669          2,489
  Equipment ......................................................          2,592           2,512          2,389
  Data processing ................................................          2,416           2,283          2,108
  Office supplies ................................................          1,245           1,247          1,266
  Service charges from correspondent banks .......................            513             781            931
  Amortization of core deposit intangibles .......................            653              --             --
  Other ..........................................................          6,187           5,498          4,913
                                                                     --------------------------------------------
     Total non-interest expense ..................................         39,779          33,879         32,341

     Income before income taxes ..................................         28,681          22,821         25,446
Income taxes .....................................................         10,373           8,043          8,841
                                                                     --------------------------------------------
     Net income ..................................................   $     18,308    $     14,778   $     16,605
                                                                     ============================================

Per share data:
  Basic earnings per share .......................................   $       1.82    $       1.56   $       1.62
  Weighted average shares of common stock outstanding ............     10,060,032       9,481,034     10,242,929

  Diluted earnings per share .....................................   $       1.80    $       1.54   $       1.60
  Weighted average shares of common stock and dilutive potential
    common shares outstanding ....................................     10,157,409       9,594,148     10,359,836

  Dividends declared per share ...................................   $       0.89    $       0.85   $       0.76

</TABLE>

See accompanying notes to consolidated financial statements.

                                       44
<PAGE>





                             MAIN STREET TRUST, INC.
                                AND SUBSIDIARIES

           Consolidated Statements of Changes in Shareholders' Equity

                  Years Ended December 31, 2005, 2004 and 2003
                (in thousands, except share and per share data)

<TABLE>

                                                                                       Accumulated
                                                                                          Other
                                                                                      Comprehensive
                                                  Common Stock     Paid-in   Retained     Income      Treasury Stock
                                               Shares     Amount   Capital   Earnings     (Loss)     Shares     Amount     Total
                                             ------------------------------------------------------------------------------------
<S>                                           <C>          <C>    <C>        <C>       <C>         <C>       <C>        <C>
Balance, December 31, 2002 ................   11,219,319   $ 112  $ 55,337   $ 92,853   $  3,776     755,047   $(17,608)  $ 134,470
  Comprehensive Income:
    Net income ............................           --      --        --     16,605         --          --         --      16,605
    Net change in unrealized
      gain (loss) on securities
      available-for-sale, net of
      taxes of ($1,228) ...................           --      --        --         --     (1,842)         --         --      (1,842)
    Reclassification adjustment,
      net of tax of $5 ....................           --      --        --         --          7          --         --           7
                                                                                                                         ----------
    Comprehensive income ..................                                                                                  14,770
                                                                                                                         ----------
  Stock appreciation rights ...............           --      --       (66)        --         --          --         --         (66)
  Cash dividends declared ($0.76 per share)           --      --        --     (7,567)        --          --         --      (7,567)
  Treasury stock transactions, net ........           --      --        --       (370)        --     963,903    (29,787)    (30,157)
                                             --------------------------------------------------------------------------------------
Balance, December 31, 2003 ................   11,219,319     112    55,271    101,521      1,941   1,718,950    (47,395)    111,450
  Comprehensive Income:
    Net income ............................           --      --        --     14,778         --          --         --      14,778
    Net change in unrealized
      gain (loss) on securities
      available-for-sale, net of
      taxes of ($1,386) ...................           --      --        --         --     (2,079)         --         --      (2,079)
    Reclassification adjustment,
      net of tax of ($53) .................           --      --        --         --        (80)         --         --         (80)
                                                                                                                         ----------
    Comprehensive income ..................                                                                                  12,619
                                                                                                                         ----------
  Stock appreciation rights ...............           --      --       (82)        --         --          --         --         (82)
  Cash dividends declared ($0.85 per share)           --      --        --     (8,056)        --          --         --      (8,056)
  Treasury stock transactions, net ........           --      --        --       (172)        --      51,379     (1,784)     (1,956)
                                             --------------------------------------------------------------------------------------
Balance, December 31, 2004 ................   11,219,319     112    55,189    108,071       (218)  1,770,329    (49,179)    113,975
  Comprehensive Income:
    Net income ............................           --      --        --     18,308         --          --         --      18,308
    Net change in unrealized
      gain (loss) on securities
      available-for-sale, net of
      taxes of ($1,154) ...................           --      --        --         --     (1,731)         --         --      (1,731)
    Reclassification adjustment,
      net of tax of $234 ..................           --      --        --         --        352          --         --         352
                                                                                                                         ----------
    Comprehensive income ..................                                                                                  16,929
                                                                                                                         ----------
  Cash dividends declared ($0.89 per share)           --      --        --     (8,926)        --          --         --      (8,926)
  Acquisition of Citizens First
    Financial Corp. .......................           --      --        --      2,888         --    (896,899)    24,916      27,804
  Treasury stock transactions, net ........           --      --        --       (103)        --     199,214     (5,910)     (6,013)
                                             --------------------------------------------------------------------------------------
Balance, December 31, 2005 ................   11,219,319   $ 112  $ 55,189   $120,238  $  (1,597)  1,072,644   $(30,173)  $ 143,769
                                             ======================================================================================
</TABLE>

See accompanying notes to consolidated financial statements.

                                       45
<PAGE>


                             MAIN STREET TRUST, INC.
                                AND SUBSIDIARIES

                      Consolidated Statements of Cash Flows
                  Years Ended December 31, 2005, 2004 and 2003
                                 (in thousands)
<TABLE>

                                                                             2005        2004          2003
                                                                          -----------------------------------
<S>                                                                       <C>          <C>          <C>
Cash flows from operating activities:
  Net income ..........................................................   $  18,308    $  14,778    $  16,605
  Adjustments to reconcile net income to net cash
    provided by operating activities:
    Depreciation and amortization .....................................       2,533        2,544        2,453
    Amortization of bond premiums, net of accretion ...................       1,082        2,386        2,249
    Amortization of core deposit intangibles ..........................         653           --           --
    Provision for loan losses .........................................       1,530        1,100        1,470
    Deferred income taxes .............................................         (13)         208         (637)
    Securities transactions, net ......................................         586         (133)          12
    Federal Home Loan Bank stock dividend .............................        (797)        (250)        (296)
    Undistributed earnings from non-marketable equity securities ......      (1,555)        (304)        (172)
    Gain on sales of mortgage loans, net ..............................        (886)        (997)      (2,536)
    Loss (gain) on disposal of premises and equipment .................           8         (236)          (2)
    Proceeds from sales of mortgage loans originated for sale .........      65,334       76,864      209,192
    Mortgage loans originated for sale ................................     (64,822)     (76,240)    (204,316)
    Other, net ........................................................       2,527          503       (3,281)
                                                                          -----------------------------------
     Net cash provided by operating activities ........................      24,488       20,223       20,741
                                                                          -----------------------------------

Cash flows from investing activities:
  Net increase in loans ...............................................     (15,264)     (96,108)      (3,647)
  Proceeds from maturities and calls of investments in debt securities:
    Held-to-maturity ..................................................       9,549       20,793       15,217
    Available-for-sale ................................................     194,110      192,975      163,034
  Proceeds from sales of investments in debt and equity securities:
    Available-for-sale ................................................      56,245        3,223       11,085
  Purchases of investments in debt and equity securities:
    Held-to-maturity ..................................................     (17,377)     (49,029)     (63,526)
    Available-for-sale ................................................    (317,443)    (219,215)    (222,498)
    Non-marketable equity securities ..................................        (685)        (425)        (830)
  Principal paydowns from mortgage-backed securities:
    Held-to-maturity ..................................................      11,752       42,967       18,923
    Available-for-sale ................................................      14,777       14,660       18,738
  Return of principal on non-marketable equity securities .............       1,800          522          490
  Proceeds from redemption of non-marketable equity securities ........          --          231           --
  Purchases of premises and equipment .................................      (2,516)      (2,396)      (1,749)
  Proceeds from disposal of premises and equipment ....................           8          623           25
  Acquisition of Citizens First Financial Corporation, net
    of cash and cash equivalents acquired .............................      (6,385)          --           --
                                                                          -----------------------------------
     Net cash (used in) investing activities ..........................     (71,429)     (91,179)     (64,738)
                                                                          -----------------------------------

Cash flows from financing activities:
  Net increase in deposits ............................................      69,306       76,105       29,886
  Net increase (decrease) in federal funds purchased,
    repurchase agreements, and notes payable ..........................      21,552       (6,098)      22,347
  Advances from Federal Home Loan Bank advances and other borrowings ..      39,000           --        2,268
  Payments on Federal Home Loan Bank advances and other borrowings ....     (39,095)         (98)         (94)
  Cash dividends paid .................................................      (8,671)      (7,972)      (7,142)
  Treasury stock transactions, net ....................................      (6,013)      (1,956)     (30,111)
                                                                          -----------------------------------
     Net cash provided by financing activities ........................      76,079       59,981       17,154
                                                                          -----------------------------------
     Net increase (decrease) in cash and cash equivalents .............      29,138      (10,975)     (26,843)
Cash and cash equivalents at beginning of year ........................      64,928       75,903      102,746
                                                                          -----------------------------------
Cash and cash equivalents at end of period ............................   $  94,066    $  64,928    $  75,903
                                                                          ===================================
</TABLE>

See accompanying notes to consolidated financial statements.

                                       46
<PAGE>



                             MAIN STREET TRUST, INC.
                                AND SUBSIDIARIES
                Supplemental Disclosure of Cash Flow Information
                  Years Ended December 31, 2005, 2004 and 2003
                                 (in thousands)

<TABLE>

                                                                             2005        2004          2003
                                                                          -----------------------------------
<S>                                                                       <C>          <C>         <C>
Cash paid during the year for:
  Interest .............................................                  $  25,616    $  15,920   $  17,306
  Income Taxes .........................................                      8,931        6,780       8,937
  Real estate acquired through or in lieu of foreclosure                        148           40          60
Dividends declared not paid ............................                      2,334        2,079       1,995

Acquisition of Citizens First Financial Corporation:
  Stock issued .........................................                     27,804
  Cash paid ............................................                     28,416
  Capitalized expenses .................................                        621
                                                                          ---------
     Total cost of acquisition .........................                     56,841
                                                                          =========


Assets acquired:
  Cash and due from banks ..............................                      6,022
  Federal funds sold and interest bearing deposits .....                     16,630
                                                                          ---------
     Cash and cash equivalents .........................                     22,652

Investments in debt and equity securities:
  Available-for-sale, at fair value ....................                     23,865
  Non-marketable equity securities .....................                     16,374
Loans, net of allowance for loan losses ................                    228,114
Mortgage loans held for sale ...........................                        282
Premises and equipment .................................                      5,993
Accrued interest receivable ............................                      1,571
Goodwill ...............................................                     20,736
Core deposit intangibles ...............................                      5,222
Other assets ...........................................                      6,174
Liabilities assumed:
Deposits ...............................................                   (232,089)
Federal Home Loan Bank advances and other borrowings ...                    (37,599)
Accrued interest payable ...............................                       (193)
Other liabilities ......................................                     (4,261)
                                                                          ---------
Net assets acquired ....................................                     56,841
                                                                          =========

</TABLE>

See accompanying notes to consolidated financial statements



                                       47
<PAGE>

                             MAIN STREET TRUST, INC.
                                AND SUBSIDIARIES

                   Notes to Consolidated Financial Statements


1.   Summary of Significant Accounting Policies

     (a) Nature of Operations

         Through Main Street Bank & Trust (the "Bank"),  Main Street Trust, Inc.
         (the "Company") provides a full range of banking services to individual
         and corporate  customers  located within  Champaign,  Decatur,  Peoria,
         Bloomington,   and   Shelbyville,   Illinois,   and   the   surrounding
         communities.   In  addition,   the  Company   provides  retail  payment
         processing services through FirsTech, Inc. The subsidiaries are subject
         to  competition  from other  financial  institutions  and  nonfinancial
         institutions   providing   financial   products  and  similar   payment
         processing  services.  Additionally,  the  Company  is  subject  to the
         regulations  of  certain  regulatory   agencies  and  undergo  periodic
         examinations by those regulatory agencies.

     (b) Use of Estimates

         The consolidated financial statements of the company have been prepared
         in conformity  with  accounting  principles  generally  accepted in the
         United States of America and conform to  predominant  practices  within
         the banking  industry.  The preparation of the  consolidated  financial
         statements in conformity with accounting  principles generally accepted
         in the United States of America  requires  management to make estimates
         and assumptions,  including the determination of the allowance for loan
         losses,  impairment  of  goodwill  and the  valuation  of  real  estate
         acquired in connection  with  foreclosure or in  satisfaction of loans,
         that  affect  the  reported  amounts  of  assets  and  liabilities  and
         disclosure  of  contingent  assets and  liabilities  at the date of the
         consolidated  financial statements and the reported amounts of revenues
         and expenses during the reporting  period.  Actual results could differ
         from those estimates.

     (c) Principles of Consolidation

         The  consolidated  financial  statements  include the  accounts of Main
         Street Trust, Inc. and its wholly owned subsidiaries,  Main Street Bank
         & Trust and FirsTech,  Inc., a retail payment  processing  company.  On
         April 1, 2005, the Company  purchased  Citizens First Financial  Corp.,
         which  was the  parent  company  of  Citizens  Savings  Bank,  based in
         Bloomington,  Illinois.  At the close of  business  on October 7, 2005,
         Citizens Savings Bank was merged into Main Street Bank & Trust.  During
         2004,  the  Company's  subsidiary  banks,  BankIllinois  and The  First
         National Bank of Decatur, were merged to form Main Street Bank & Trust.
         Significant intercompany accounts and transactions have been eliminated
         in consolidation.

         Property  held in fiduciary or agency  capacities  for its customers is
         not included in the  accompanying  consolidated  balance sheets,  since
         such items are not assets of the Company.

     (d) Segment Information

         The Company currently  operates in two industry  segments.  The primary
         business involves  providing banking services to central Illinois.  The
         Bank  offers  a full  range  of  financial  services  to  business  and
         individual customers.  These services include demand, savings, time and
         individual   retirement  accounts;   commercial,   consumer  (including
         automobile loans and personal lines of credit),  agricultural, and real
         estate  lending;  safe  deposit  and night  depository  services;  farm
         management;  full service trust  department  that offer a wide range of
         services such as investment management,  acting as trustee,  serving as
         guardian,  executor or agent,  miscellaneous  consulting,  full service
         brokerage services offered through a third party provider, farm realty;
         and purchases of  installment  obligations  from  retailers,  primarily
         without  recourse.  The other industry  segment involves retail payment
         processing. FirsTech provides the following services to electric, water
         and gas utilities,  telecommunication companies, cable television firms
         and charitable  organizations:  retail  lockbox  processing of payments
         delivered  by mail on  behalf of the  biller;  processing  of  payments
         delivered  by   customers  to  pay  agents  such  as  grocery   stores,
         convenience  stores  and  currency  exchanges;   and  concentration  of
         payments  delivered by the  Automated  Clearing  House  network,  money
         management  software such as Quicken and through  networks such as Visa
         e-Pay and MasterCard RPS.

                                       48
<PAGE>

         Company information is provided for informational  purposes only, since
         it is  not  considered  a  separate  segment  for  reporting  purposes.
         Effective January 1, 2003, certain administrative,  audit,  compliance,
         accounting,  finance,  property management,  human resources,  courier,
         information  systems and other support services  previously included in
         the  budgets  of the  Company's  subsidiary  banks  were  moved  to the
         Company.  During this process,  approximately  80 full time  equivalent
         employees were moved from the banks to the Company. The net expenses of
         these  functions  were  allocated  to the  subsidiaries  by  charging a
         monthly management fee. Effective January 1, 2005, these functions were
         moved  to  the  Banking   Services   Segment.   During  this   process,
         approximately  77 full time  equivalent  employees  were moved from the
         Company  to Main  Street  Bank &  Trust.  The  net  expenses  of  these
         functions  were  allocated  to the Company  and  FirsTech by charging a
         monthly management fee.

         The  following is a summary of selected  data for the various  business
         segments as of and for the year ending December 31 (in thousands):

<TABLE>

                                   Banking   Remittance
                                  Services    Services      Company     Eliminations     Total
------------------------------------------------------------------------------------------------
<S>                             <C>          <C>          <C>           <C>           <C>
2005
 Total interest income ......   $   75,087   $       14   $    1,935    $      (44)   $   76,992
 Total interest expense .....       27,180           --          343           (44)       27,479
 Provision for loan losses ..        1,530           --           --            --         1,530
 Total non-interest income ..       15,238        6,899         (592)       (1,068)       20,477
 Total non-interest expense .       35,199        4,281        1,367        (1,068)       39,779
 Income before income tax ...       26,416        2,632         (367)           --        28,681
 Income tax expense .........        9,428        1,107         (162)           --        10,373
 Net income .................       16,988        1,525         (205)           --        18,308
 Goodwill ...................       20,736           --           --            --        20,736
 Total assets ...............    1,610,026        3,365      153,974      (142,228)    1,625,137
 Depreciation and amortization       2,126          354           53            --         2,533

2004
 Total interest income ......   $   54,383   $       23   $      497    $      (98)   $   54,805
 Total interest expense .....       16,876           --           74           (98)       16,852
 Provision for loan losses ..        1,100           --           --            --         1,100
 Total non-interest income ..       12,779        7,283        4,697        (4,912)       19,847
 Total non-interest expense .       27,120        5,012        6,659        (4,912)       33,879
 Income before income tax ...       22,066        2,294       (1,539)           --        22,821
 Income tax expense .........        7,709          963         (629)           --         8,043
 Net income .................       14,357        1,331         (910)           --        14,778
 Total assets ...............    1,209,207        3,936      121,348      (106,373)    1,228,118
 Depreciation and amortization       1,535          623          386            --         2,544

2003
 Total interest income ......   $   55,288   $       46   $      466    $     (114)   $   55,686
 Total interest expense .....       16,816           --           21          (114)       16,723
 Provision for loan losses ..        1,470           --           --            --         1,470
 Total non-interest income ..       13,314        7,294        4,653        (4,967)       20,294
 Total non-interest expense .       26,486        5,014        5,808        (4,967)       32,341
 Income before income tax ...       23,830        2,326         (710)           --        25,446
 Income tax expense .........        8,185          942         (286)           --         8,841
 Net income .................       15,645        1,384         (424)           --        16,605
 Total assets ...............    1,136,418        3,740      118,241      (104,225)    1,154,174
 Depreciation and amortization       1,542          429          482            --         2,453

</TABLE>


     (e) Comprehensive Income

         Accounting   principles  generally  require  that  recognized  revenue,
         expenses, gains, and losses be included in net income. Although certain
         changes in assets and liabilities,  such as unrealized gains and losses
         on available-for-sale  securities, are reported as a separate component
         of the equity section of the balance sheet, such items,  along with net
         income, are components of comprehensive income.

     (f) Investments in Debt and Equity Securities

         Debt securities  classified as  held-to-maturity  are those  securities
         which the Company  has the  ability and intent to hold until  maturity.
         These   securities  are  carried  at  amortized   cost,  in  which  the
         amortization  of  premiums  and  accretion  of  discounts,   which  are
         recognized  as  adjustments  to interest  income,  are  recorded  using
         methods which  approximate the interest method.  These methods consider
         the  timing  and  amount of  prepayments  of  underlying  mortgages  in
         estimating future cash flows on individual mortgage-related securities.
         Unrealized holding gains and losses for held-to-maturity securities are
         excluded from earnings and shareholders' equity.

                                       49
<PAGE>

         Debt and equity securities classified as  available-for-sale  are those
         securities that the Company intends to hold for an indefinite period of
         time but not  necessarily to maturity.  Any decision to sell a security
         classified as available-for-sale is based on various factors, including
         significant movements in interest rates, changes in the maturity mix of
         the  Company's  assets and  liabilities,  liquidity  needs,  regulatory
         capital   considerations,   and  other  similar   factors.   Securities
         available-for-sale  are carried at fair value.  The difference  between
         fair value and cost, adjusted for amortization of premium and accretion
         of discounts,  results in an unrealized gain or loss.  Unrealized gains
         or losses  are  reported  as  accumulated  other  comprehensive  income
         (loss),  net of the related  deferred tax effect.  Gains or losses from
         the sale of securities are determined using the specific identification
         method.  Premiums and discounts are recognized in interest income using
         methods,  which approximate the interest method over their amortization
         periods.  Amortization  period is defined as call date if the  security
         was purchased at a premium or maturity date if purchased at a discount.

         Declines in the fair value of held-to-maturity  and  available-for-sale
         securities  below their cost that are deemed to be other than temporary
         are   reflected  in  earnings  as  realized   losses.   In   estimating
         other-than-temporary  impairment losses,  management  considers (1) the
         length of time and the  extent  to which  the fair  value has been less
         than cost, (2) the financial  condition and near-term  prospects of the
         issuer,  and (3) the  intent and  ability of the  Company to retain its
         investment  in the issuer for a period of time  sufficient to allow for
         any anticipated recovery in fair value.

         Effective for the period ended December 31, 2005, the Company  modified
         its  policy  for  evaluating   investments   for   other-than-temporary
         impairment. Under its new policy, investments, other than debt security
         investments where the impairment is deemed to be due solely to interest
         rate  movements,   are  assumed  to  be  impaired  and  the  impairment
         recognized  through  earnings no later than twelve months from the date
         the security was first impaired, unless there is "overwhelming evidence
         to the  contrary."  Under the  policy,  "overwhelming  evidence  to the
         contrary" is a rare instance, but might include, among other things, an
         announced  sale soon after a  reporting  period  where the price  would
         cause an impairment to reverse.  Further,  under certain circumstances,
         including a bankruptcy, catastrophic event or other circumstances which
         cause the Company to determine,  after  analyzing  the specific  facts,
         that the decline in the fair value is other than temporary, the Company
         would recognize an other than temporary impairment write-down upon such
         occurrence or  determination,  and not wait twelve months from the time
         of the impairment.

         Non-marketable  equity  securities  include other investments which are
         carried at fair value as well as the Bank's required  investment in the
         capital  stock of the  Federal  Home Loan Bank which is carried at cost
         which approximates fair value.

     (g) Loans

         Loans  are  stated  at the  principal  amount  outstanding,  net of the
         allowance  for loan  losses.  Interest is credited to income as earned,
         based upon the principal amount outstanding.

         The accrual of interest on loans is  discontinued  when, in the opinion
         of  management,  the borrower is unable to meet payments as they become
         due.  Interest accrued in the current year is reversed against interest
         income,  and prior years' interest is charged to the allowance for loan
         losses.  Interest  income on impaired loans is recognized to the extent
         interest  payments are received and the principal is  considered  fully
         collectible.

         Mortgage loans held for sale are carried at the lower of aggregate cost
         or estimated  market value.  Gains or losses on sales of loans held for
         sale are  computed  using the  specific-identification  method  and are
         reflected in income at the time of sale.

         Loan  origination fees and certain direct  origination  costs are being
         amortized as an  adjustment of the yield over the  contractual  life of
         the related loan, adjusted for prepayments, using the interest method.

     (h) Mortgage Servicing Rights

         The fair market  value of servicing  rights on mortgage  loans that are
         sold with servicing retained is capitalized.  The capitalized servicing
         rights are amortized against income based on the estimated lives of the
         loans.  Capitalized servicing rights are evaluated for impairment based
         on the  fair  value  of the  servicing  rights  and any  impairment  is
         reflected in income.

                                       50
<PAGE>

     (i) Allowance for Loan Losses

         The  allowance  for loan losses is increased by  provisions  charged to
         operations  and  is  reduced  by  loan   charge-offs  less  recoveries.
         Management  utilizes  an  approach,  which  provides  for  general  and
         specific  valuation  allowances,  that is  based  on  current  economic
         conditions, past losses, collection experience, risk characteristics of
         the portfolio, assessment of collateral values by obtaining independent
         appraisals for significant properties, and such other factors which, in
         management's  judgment,  deserve current recognition in estimating loan
         losses,  to determine the  appropriate  level of the allowance for loan
         losses.

         The  allowance  for loan  losses  related  to  impaired  loans that are
         identified  for  evaluation is based on discounted  cash flow using the
         loan's initial effective  interest rate or the fair value, less selling
         costs, of the collateral for collateral dependent loans.

         Loans are categorized as "impaired" when, based on current  information
         or events,  it is probable  that the Company  will be unable to collect
         all amounts due, including  principal and interest,  in accordance with
         the contractual  terms of the loan  agreement.  The Company reviews all
         non-accrual  and  substantially  delinquent  loans,  as well as problem
         loans  identified by  management,  for  impairment as defined  above. A
         specific reserve amount will be established for impaired loans in which
         the present  value of the  expected  cash flows to be generated is less
         than the amount of the loan  recorded  on the  Company's  books.  As an
         alternative to discounting, the Company may use the "fair value" of any
         collateral  supporting a  collateral-dependent  loan in  reviewing  the
         necessity  for  establishing  a  specific  loan  loss  reserve  amount.
         Specific  reserves will be established for accounts having a collateral
         deficiency  estimated  to be $50,000  or more.  The  Company's  general
         reserve is maintained at an adequate level to cover  accounts  having a
         collateral  deficiency of less than $50,000.  Loans evaluated as groups
         or homogeneous pools of loans will be excluded from this analysis.

         The  Company  utilizes  its data  processing  system to  identify  loan
         payments  not made by their  contractual  due  date and  calculate  the
         number of days each loan exceeds the contractual due dates. The accrual
         of  interest  on any  loan is  discontinued  when,  in the  opinion  of
         management,  there  is  reasonable  doubt as to the  collectibility  of
         interest or principal.

         Management believes the allowance for loan losses is adequate to absorb
         probable credit losses inherent in the loan portfolio. While management
         uses available  information to recognize loan losses,  future additions
         to the allowance  for loan losses may be necessary  based on changes in
         economic conditions.  In addition,  various regulatory agencies,  as an
         integral part of their  examination  process,  periodically  review the
         adequacy of the  allowance  for loan losses.  Such agencies may require
         the Company to  recognize  additions to the  allowance  for loan losses
         based on their  judgments of information  available to them at the time
         of their examination.

     (j) Premises and Equipment

         Premises and equipment are stated at cost less accumulated depreciation
         and amortization. Depreciation and amortization applicable to furniture
         and equipment and  buildings and leasehold  improvements  is charged to
         the related  occupancy or equipment  expense  using  straight-line  and
         accelerated  methods  over the  estimated  useful  lives of the assets.
         Estimated  lives  are  2  to  39  years  for  buildings  and  leasehold
         improvements and 1 to 10 years for furniture and equipment.

     (k) Other Real Estate

         Other  real  estate,  included  in  other  assets  in the  accompanying
         consolidated balance sheets, is initially recorded at fair value, if it
         will be held and used,  or at its fair  value  less costs to sell if it
         will be disposed of. If,  subsequent to foreclosure,  the fair value is
         less than the carrying amount,  the carrying value is reduced through a
         charge to income.  Expenses  incurred in maintaining the properties are
         charged to operations. The Company had $188,000 of other real estate at
         December 31, 2005 and none at December 31, 2004.

     (l) Income Taxes

         Deferred tax assets and  liabilities  are  recognized for the estimated
         future  tax  consequences   attributable  to  differences  between  the
         financial statement carrying amounts of existing assets and liabilities
         and their respective tax bases. Deferred tax assets and liabilities are
         measured  using enacted tax rates in effect for the year in which those
         temporary  differences  are expected to be  recovered  or settled.  The
         effect on deferred tax assets and  liabilities of a change in tax rates
         is recognized in income in the period that includes the enactment date.

                                       51
<PAGE>

     (m) Earnings Per Share

         Basic  earnings  per share is computed  by  dividing  net income by the
         weighted  average  number of commo. stock shares  outstanding.  Diluted
         earnings  per share is computed by dividing  net income by the weighted
         average  number of common stock and dilutive  potential  common  shares
         outstanding.  Options to purchase shares of the Company's  common stock
         are the only dilutive  potential  common shares.  The weighted  average
         number of dilutive  potential  common  shares is  calculated  using the
         treasury stock method.

         Earnings per share has been computed as follows:

<TABLE>

                                                             2005          2004          2003
                                                          ---------------------------------------
<S>                                                       <C>           <C>           <C>
Net Income ............................................   $18,308,000   $14,778,000   $16,605,000
Shares:
  Weighted average common shares outstanding ..........    10,060,032     9,481,034    10,242,929
  Dilutive effect of outstanding options, as determined
    by the application of the treasury stock method ...        97,377       113,114       116,907
                                                          ---------------------------------------
  Weighted average common shares outstanding,
    as adjusted .......................................    10,157,409     9,594,148    10,359,836
                                                          =======================================
Basic earnings per share ..............................   $      1.82   $      1.56   $      1.62
                                                          =======================================

Diluted earnings per share ............................   $      1.80   $      1.54   $      1.60
                                                          =======================================

</TABLE>


     (n) Cash and Cash Equivalents

         For purposes of the  consolidated  statements  of cash flows,  cash and
         cash equivalents include cash and due from banks and federal funds sold
         and interest bearing  deposits.  Generally,  federal funds are sold for
         one-day  periods.  Cash flows from loans,  deposits,  and federal funds
         purchased, repurchase agreements and notes payable are reported net.

     (o) Emerging Accounting Standards

         In December 2004,  the Financial  Accounting  Standards  Board ("FASB")
         published FASB Statement No. 123 (revised 2004),  "Share-Based Payment"
         ("FAS  123(R)"  or the  "Statement").  FAS  123(R)  requires  that  the
         compensation  cost  relating  to  share-based   payment   transactions,
         including  grants of  employee  stock  options,  be  recognized  in the
         financial  statements.  That  cost will be  measured  based on the fair
         value of the equity or liability instruments issued. FAS 123(R) permits
         entities  to use any  option-pricing  model  that  meets the fair value
         objective in the Statement.  The Statement was originally  effective at
         the beginning of the Company's third quarter in 2005, however, in April
         2005  the  adoption  of a new  rule,  by the  Securities  and  Exchange
         Commission,  changed the dates for compliance  with this standard.  The
         Company  will  now  be  required  to  implement  Statement  No.  123(R)
         beginning January 1, 2006.

         As of the effective  date, the Company will have the option of applying
         the Statement using the modified prospective  application or a modified
         retrospective application.  Under the prospective method,  compensation
         cost would be recognized  for (1) all awards granted after the required
         effective date and for awards modified,  cancelled or repurchased after
         that date and (2) the portion of prior  awards for which the  requisite
         service has not yet been rendered,  based on the grant-date  fair value
         of those awards  calculated for pro forma  disclosures  under SFAS 123.
         Under the retrospective application method,  compensation cost would be
         recognized  as in (1) above and (2) for prior periods would be restated
         consistent with the pro forma disclosures required for those periods by
         SFAS 123. The valuation model and amortization  assumption we have used
         will continue to be used.

         The impact of this  Statement on the Company after the  effective  date
         and beyond  will  depend  upon  various  factors,  among them being the
         future compensation strategy. The SFAS 123 pro forma compensation costs
         presented (see Note 1(p) below) to the financial  statements  have been
         calculated using the Black-Scholes  option-pricing model and may not be
         indicative  of  amounts  which may be  recognized  as expense in future
         periods.

                                       52
<PAGE>

         In May 2005, the FASB issued SFAS No. 154, Accounting Changes and Error
         Corrections,   which  provides  guidance  on  the  accounting  for  and
         reporting of accounting changes and error corrections.  It establishes,
         unless impracticable,  retrospective application as the required method
         for  reporting  a change in  accounting  principle  in the  absence  of
         explicit  transition   requirements   specific  to  the  newly  adopted
         accounting  principle.  The  reporting of a  correction  of an error by
         restating  previously issued financial  statements is also addressed by
         this  statement.  SFAS No. 154 is effective for accounting  changes and
         corrections of errors made in fiscal years beginning after December 15,
         2005.  Management  does not  believe  that this  statement  will have a
         material impact on the Company's financial statements.

         On  February  8,  2006,  President  Bush  signed  the  Federal  Deposit
         Insurance  Reform Act of 2005 ("FDIRA") into law as part of the Deficit
         Reduction Act of 2005 and on February 15, 2006,  President  Bush signed
         into law the technical and conforming  amendments designed to implement
         FDIRA. FDIRA provides for legislative  reforms to modernize the federal
         deposit insurance system.

         Among other things,  FDIRA: (i) merges the BIF and the SAIF of the FDIC
         into a new Deposit  Insurance  Fund (the "DIF");  (ii) allows the FDIC,
         after March 31,  2010,  to increase  deposit  insurance  coverage by an
         adjustment  for  inflation  and requires the FDIC's Board of Directors,
         not later  than  April 1,  2010 and every  five  years  thereafter,  to
         consider  whether such an increase is  warranted;  (iii)  increases the
         deposit insurance limit for certain employee benefit plan deposits from
         $100,000 to $250,000,  subject to adjustments for inflation after March
         31, 2010,  and provides for  pass-through  insurance  coverage for such
         deposits;  (iv)  increases  the  deposit  insurance  limit for  certain
         retirement  account  deposits  from  $100,000 to  $250,000,  subject to
         adjustments  for inflation  after March 31, 2010; (v) allows the FDIC's
         Board of Directors to set deposit insurance premium  assessments in any
         amount the Board of Directors  deems  necessary or  appropriate,  after
         taking into account various factors  specified in FDIRA;  (vi) replaces
         the fixed designated  reserve ratio of 1.25% with a reserve ratio range
         of  1.15%-1.50%,  with the  specific  reserve  ratio  to be  determined
         annually by the FDIC by  regulation;  (vii)  permits the FDIC to revise
         the risk-based  assessment  system by regulation;  (viii)  requires the
         FDIC,  at the end of any year in  which  the  reserve  ratio of the DIF
         exceeds  1.5% of  estimated  insured  deposits,  to  declare a dividend
         payable to insured  depository  institutions in an amount equal to 100%
         of the  amount  held by the DIF in excess of the  amount  necessary  to
         maintain the DIF's reserve ratio at 1.5% of estimated  insured deposits
         or to  declare a  dividend  equal to 50% of the amount in excess of the
         amount  necessary to maintain the reserve ratio at 1.35% if the reserve
         ratio is between  1.35%-1.5% of estimated  insured  deposits;  and (ix)
         provides  a  one-time  credit  based  upon the  assessment  base of the
         institution on December 31, 1996 to each insured depository institution
         that was in  existence  as of  December  31,  1996  and paid a  deposit
         insurance  assessment  prior to that date (or a  successor  to any such
         institution).

         The merger of the BIF and SAIF  takes  effect  June 1, 2006,  while the
         remaining  provisions  are not  effective  until the FDIC issues  final
         regulations.  FDIRA  requires  the FDIC to issue final  regulations  no
         later than 270 days after  enactment:  (i) designating a reserve ratio;
         (ii)  implementing  increases  in  deposit  insurance  coverage;  (iii)
         implementing the dividend  requirement;  (iv) implementing the one-time
         assessment credit; and (v) providing for assessments in accordance with
         FDIRA.

                                       53
<PAGE>

     (p) Stock Option Plans

         The  Company  has a  stock-based  compensation  plan  which has been in
         existence  for all periods  presented,  and is more fully  described in
         Note 13. As permitted under accounting principles generally accepted in
         the United  States of  America,  grants of options  under the plans are
         accounted for under the recognition  and measurement  principles of APB
         Opinion No 25,  Accounting  for Stock Issued to Employees,  and related
         interpretations.  Because  options  granted  under  the  plans  had  an
         exercise price equal to market value of the underlying  common stock on
         the grant date, no stock-based  employee  compensation cost is included
         in determining net income.  The following table  illustrates the effect
         on net income (in  thousands) and earnings per share if the Company had
         applied the fair value  recognition  provisions  of FASB  Statement No.
         123, Accounting for Stock-Based  Compensation,  to stock-based employee
         compensation.

<TABLE>

                                                        2005         2004          2003
                                                     -------------------------------------
<S>                                                  <C>           <C>           <C>
Net income on common stock:
  As reported ....................................   $   18,308    $   14,778    $   16,605
  Deduct total stock-based compensation expense
    determined under the fair value method for all
    awards, net of related tax effects ...........         (365)         (366)         (263)
                                                     -------------------------------------
     Pro forma ...................................   $   17,943    $   14,412    $   16,342
                                                     ======================================
Basic earnings per share:
  As reported ....................................   $     1.82    $     1.56    $     1.62
  Pro forma ......................................         1.78          1.52          1.60
Diluted earnings per share:
  As reported ....................................   $     1.80    $     1.54    $     1.60
  Pro forma ......................................         1.77          1.50          1.58

</TABLE>


         The fair value of the stock options  granted has been  estimated  using
         the  Black-Scholes  option-pricing  model with the  following  weighted
         average  assumptions.   The  Black-Scholes   option-pricing  model  was
         developed for use in estimating the fair value of traded options, which
         have no vesting restrictions.  In addition, such models require the use
         of subjective  assumptions,  including expected stock price volatility.
         In  management's  opinion,  such valuation  models may not  necessarily
         provide the best single measure of option value.


<TABLE>

                                        2005             2004           2003
                                   --------------------------------------------
<S>                                <C>                 <C>             <C>
Number of options granted .....       137,500           140,500        135,000
Risk-free interest rate .......    3.83% - 4.08%          3.94%          3.64%
Expected life, in years .......    7.00 - 8.00            8.00           8.00
Expected volatility ...........    15.05% - 15.42%       15.95%         13.35%
Expected dividend yield .......    2.97% - 3.06%          2.75%          2.42%

</TABLE>


     (q) Acquired Goodwill and Intangible Assets

         Goodwill of $20.736  million  resulted from the acquisition of Citizens
         First  Financial  Corp. in 2005.  Goodwill was tested for impairment on
         October 31, 2005. No impairment was found.


                                    54
<PAGE>

         Intangible  assets  consist of core deposit  intangibles  from business
         acquisitions.  This  amount  is  amortized  into  other  expense  on  a
         straight-line  basis over a six year period.  On a periodic basis,  the
         Company reviews the intangible assets for events or circumstances  that
         may indicate a change in recoverability of the underlying basis.

<TABLE>
                                                              As of December 31, 2005
                                                           -----------------------------
                                                           Gross Carrying   Accumulated
                                                               Amount      Amortization
                                                           -----------------------------
<S>                                                           <C>            <C>
Amortized intangible assets
  Core deposit intangibles ...............................   $  5,222        $   653

Unamortized intangible assets
  Goodwill ...............................................   $ 20,736        $    --

Aggregate Amortization Expense:
For the year ended 12/31/05 ..............................   $    653
For the year ended 12/31/06 ..............................        870
For the year ended 12/31/07 ..............................        871
For the year ended 12/31/08 ..............................        870
For the year ended 12/31/09 ..............................        870
For the year ended 12/31/10 ..............................        870
For the year ended 12/31/11 ..............................        218

</TABLE>

2.   Acquisition of Citizens First Financial

On April 1, 2005, the Company acquired all of the outstanding  stock of Citizens
First  Financial  Corp.  ("Citizens"),  which was the parent company of Citizens
Savings Bank, based in Bloomington, Illinois. The transaction has been accounted
for as a purchase. Assets and liabilities related to the acquisition of Citizens
are reported as of the April 2005  acquisition  date.  Results of  operations of
Citizens  since  the  acquisition  date  have  been  included  in the  Company's
consolidated financial statements. The Company merged Citizens Savings Bank into
the  Bank  as of the  close  of  business  on  October  7,  2005.  The  Citizens
acquisition purchase price of approximately  $56.841 million was allocated based
upon the fair value of the assets acquired and liabilities assumed. The Citizens
excess purchase price has been allocated to goodwill and identifiable intangible
assets in  accordance  with current  accounting  literature,  to the extent that
supportable  documentation  was available at December 31, 2005. Such amounts are
subject  to  minor  adjustments  in the  near  term as  additional  analysis  is
performed or obtained from third party sources.  $5.222 million was allocated to
core deposit  intangibles at acquisition and is being amortized over a period of
six years.

Proforma  unaudited  operating  results for the year ended December 31, 2005 and
2004,  giving  effect to the  Citizens  acquisition  as if it had occurred as of
January 1, 2004 are as follows:

<TABLE>

                                                        2005              2004
                                                   -----------------------------
                                                       (in thousands, except
                                                           per share data)
                                                   -----------------------------
<S>                                                   <C>                <C>
Interest Income ..........................            $81,160            $72,854
Interest Expense .........................             29,074             23,952
Net Income ...............................             18,297             17,393
Basic EPS ................................               1.82               1.68
Diluted EPS ..............................               1.80               1.66

</TABLE>

These unaudited  proforma  results have been prepared for  comparative  purposes
only and include certain adjustments, such as additional amortization expense on
revalued purchased assets and implied interest on additional  borrowings to fund
the acquisition. In addition, 2005 merger related expenses were reallocated to a
period  prior  to the pro  forma  dates  presented.  All  adjustments  were  tax
effected. They do not purport to be indicative of the results of operations that
actually would have resulted had the combination  occurred on January 1, 2004 or
of future results of operations of the consolidated entities.

                                       55
<PAGE>

3.   Cash and Due from Banks

The compensating  balances held at correspondent  banks were $35.711 million and
$20.845 million at December 31, 2005 and 2004, respectively.  The Bank maintains
such  compensating  balances  with  correspondent  banks to offset  charges  for
services  rendered by those  banks.  In  addition,  the Bank was required by the
Federal  Reserve  Bank  to  maintain  reserves  in the  form  of cash on hand or
balances at the Federal  Reserve Bank.  The balance of reserves held was $12.014
million and $6.341 million at December 31, 2005 and 2004, respectively.


4.   Investments in Debt and Equity Securities

The amortized cost and fair values of investments in debt and equity  securities
(in thousands) were as follows:

<TABLE>

                                                                                              Available-for-Sale
                                                                                   -------------------------------------------
                                                                                                 Gross      Gross
                                                                                   Amortized   unrealized  unrealized   Fair
                                                                                      Cost        gains     losses     value
                                                                                   -------------------------------------------
<S>                                                                                 <C>        <C>        <C>        <C>
December 31, 2005
  U.S. Treasury and other
    government agencies .........................................................   $315,930   $     15   $  3,461   $312,484
  Mortgage-backed securities ....................................................     13,729         79        151     13,657
  Obligations of state and political subdivisions ...............................     13,539        363         68     13,834
  Other .........................................................................      2,551        619         58      3,112
                                                                                   -------------------------------------------
                                                                                    $345,749   $  1,076   $  3,738   $343,087
                                                                                   ==========================================

December 31, 2004
  U.S. Treasury and other
    government agencies .........................................................   $220,718   $    326   $  2,050   $218,994
  Mortgage-backed securities ....................................................     27,731        309        327     27,713
  Obligations of state and political subdivisions ...............................     16,037        698         20     16,715
  Other .........................................................................      5,457      1,524        823      6,158
                                                                                   -------------------------------------------
                                                                                    $269,943   $  2,857   $  3,220   $269,580
                                                                                   ==========================================

                                                                                                 Held-to-Maturity
                                                                                   -------------------------------------------
                                                                                                 Gross      Gross
                                                                                   Amortized   unrealized  unrealized   Fair
                                                                                      Cost        gains     losses     value
                                                                                   -------------------------------------------
December 31, 2005
  U.S. Treasury and other
    government agencies .........................................................   $ 38,650   $     --   $    919   $ 37,731
  Mortgage-backed securities ....................................................     17,091         55        162     16,984
  Obligations of state and political subdivisions ...............................     20,801        230         81     20,950
                                                                                   -------------------------------------------
                                                                                    $ 76,542   $    285   $  1,162   $ 75,665
                                                                                   ==========================================
December 31, 2004
  U.S. Treasury and other
    government agencies .........................................................   $ 40,931   $     --   $    625   $ 40,306
  Mortgage-backed securities ....................................................     14,992         37        223     14,806
  Obligations of state and political subdivisions ...............................     25,241        761         15     25,987
                                                                                   -------------------------------------------
                                                                                    $ 81,164   $    798   $    863   $ 81,099
                                                                                   ==========================================
</TABLE>

                                       56
<PAGE>

Unrealized losses and fair value,  aggregated by investment  category and length
of time that  individual  securities  have been in a continuous  unrealized loss
position, as of December 31, 2005 are summarized as follows:

<TABLE>

                                      Continuous unrealized      Continuous unrealized
                                     losses existing for less   losses existing greater
                                          than 12 months            than 12 months                Total
                                     ---------------------------------------------------------------------------
                                     Fair Value   Unrealized    Fair Value   Unrealized   Fair Value  Unrealized
                                                   Losses                      Losses                   Losses
                                     ---------------------------------------------------------------------------
<S>                                  <C>          <C>           <C>           <C>          <C>        <C>
Available-for-Sale:
  U.S. Treasury and other
    government agencies ..........   $149,575     $    420      $139,128      $  3,041     $288,703   $  3,461
  Mortgage-backed securities .....      2,511           22         6,654           129     $  9,165   $    151
  Obligations of state and
    political subdivisions .......         --           --         3,188            68     $  3,188   $     68
                                     -------------------------------------------------------------------------
        Subtotal, debt securities    $152,086     $    442      $148,970      $  3,238     $301,056   $  3,680
  Other ..........................        847           58            --            --          847         58
                                     -------------------------------------------------------------------------
        Total temporarily impaired
        securities ...............   $152,933     $    500      $148,970      $  3,238     $301,903   $  3,738
                                     =========================================================================

Held-to-Maturity:
  U.S. Treasury and other
    government agencies ..........   $    492     $      8      $ 37,239      $    911     $ 37,731   $    919
  Mortgage-backed securities .....      8,708           90         3,321            72     $ 12,029   $    162
  Obligations of state and
    political subdivisions .......      3,996           39         3,332            42     $  7,328   $     81
                                     -------------------------------------------------------------------------
        Total temporarily impaired
        securities ...............   $ 13,196     $    137      $ 43,892      $  1,025     $ 57,088   $  1,162
                                     =========================================================================
</TABLE>

Unrealized losses and fair value,  aggregated by investment  category and length
of time that  individual  securities  have been in a continuous  unrealized loss
position, as of December 31, 2004, are summarized as follows:


<TABLE>

                                        Continuous unrealized      Continuous unrealized
                                       losses existing for less   losses existing greater
                                            than 12 months            than 12 months                Total
                                       ---------------------------------------------------------------------------
                                       Fair Value   Unrealized    Fair Value   Unrealized   Fair Value  Unrealized
                                                     Losses                      Losses                   Losses
                                       ---------------------------------------------------------------------------
<S>                                    <C>          <C>           <C>           <C>          <C>        <C>
Available-for-Sale:
  U.S. Treasury and other
    government agencies ............   $153,851     $  1,591      $ 18,537      $    459     $172,388   $  2,050
  Mortgage-backed securities .......      9,016           58         7,862           269       16,878        327
  Obligations of state and
    political subdivisions .........      3,575           20            --            --        3,575         20
                                       -------------------------------------------------------------------------
          Subtotal, debt securities    $166,442     $  1,669      $ 26,399      $    728     $192,841   $  2,397
  Other ............................        764           74         1,056           749        1,820        823
                                       -------------------------------------------------------------------------
          Total temporarily impaired
          securities ...............   $167,206     $ 1,743       $ 27,455      $  1,477     $194,661   $  3,220
                                       =========================================================================


Held-to-Maturity:
  U.S. Treasury and other
    government agencies ............   $ 37,098     $    506      $  2,506      $    119     $ 39,604   $    625
  Mortgage-backed securities .......      6,069           71         6,963           152       13,032        223
  Obligations of state and
    political subdivisions .........      2,195           15            --            --        2,195         15
                                       -------------------------------------------------------------------------
          Total temporarily impaired
          securities ...............   $ 45,362     $    592      $  9,469      $    271     $ 54,831   $    863
                                       =========================================================================
</TABLE>
                                       57
<PAGE>

Management evaluates securities for other-than-temporary  impairment on at least
a quarterly  basis, and more frequently when economic or market concerns warrant
such  evaluation.   In  estimating   other-than-temporary   impairment   losses,
management  considers  (1) the  length of time and the  extent to which the fair
value  has been  less than  cost,  (2) the  financial  condition  and  near-term
prospects of the issuer, and (3) the intent and ability of the Company to retain
its investment in the issuer for the period of time  sufficient to allow for any
anticipated recovery in fair value.

For the period ended December 31, 2005, the $3.238 million continuous unrealized
loss  greater  than 12 months on  available-for-sale  securities  was made up of
forty  two debt  securities  and was  believed  to be a  temporary  loss.  Other
securities,  which  were  comprised  of equity  securities,  have no  continuous
unrealized loss greater than 12 months, a reduction of $749,000 from the loss on
December 31, 2004. The $1.025 million continuous unrealized loss greater than 12
months on held-to-maturity  securities was made up of thirty one debt securities
and was believed to be a temporary loss.

For the period ended December 31, 2004, the $1.477 million continuous unrealized
loss greater than 12 months on available-for-sale securities was made up of four
debt  securities  and seven  other  securities  which were  comprised  of equity
securities.  Equity securities represented $749,000 of the continuous unrealized
loss on  available-for-sale  securities,  which was a reduction of $232,000 from
the loss on equity  securities  of $981,000 on December 31,  2003.  The $271,000
continuous unrealized loss greater than 12 months on held-to-maturity securities
was made up of four debt securities.

Unrealized  losses on debt  securities  are generally due to changes in interest
rates and, as such,  are  considered by the Company to be temporary.  Because of
the nature of U.S. Agency securities,  most of which are single pay at maturity,
and  because  the  Company  has the  ability to hold these  investments  until a
recovery of market value,  which may be maturity,  the Company does not consider
these  investments to be other than  temporarily  impaired.  Because the Company
believes  the  decline  in  market  value  of   mortgage-backed   securities  is
attributable to changes in interest rates and not credit quality and because the
Company  has the  ability to hold these  investments  until  recovery  of market
value,  the  Company  does not  consider  these  investments  to be  other  than
temporarily impaired.

Management has analyzed the equity securities to determine whether an other than
temporary loss exists and considered several factors, including, but not limited
to, the length of time and the extent to which the market  value of the security
has been less than cost, the financial  condition and near-term prospects of the
issuer and the intent and ability of the Company to retain its investment in the
issuer for a period of time sufficient to allow for any anticipated  recovery in
market  value.  Effective  for the period ended  December 31, 2005,  the Company
modified  its  policy  for  evaluating   investments  for   other-than-temporary
impairment.  Under  its  new  policy,  investments,  other  than  debt  security
investments  where the  impairment  is deemed to be due solely to interest  rate
movements,  are assumed to be impaired  and the  impairment  recognized  through
earnings  no later  than  twelve  months  from the date the  security  was first
impaired,  unless there is  "overwhelming  evidence to the contrary."  Under the
policy,  "overwhelming  evidence to the contrary" is a rare instance,  but might
include,  among other things,  an announced  sale soon after a reporting  period
where the price would cause an  impairment  to reverse.  Further,  under certain
circumstances, including a bankruptcy, catastrophic event or other circumstances
which cause the Company to determine,  after analyzing the specific facts,  that
the  decline  in the fair  value is other  than  temporary,  the  Company  would
recognize an other than temporary impairment  write-down upon such occurrence or
determination, and not wait twelve months from the time of the impairment.

A summary of  non-marketable  equity  securities  (in thousands) at December 31,
2005 and 2004 is as follows:

<TABLE>

                                                             2005          2004
                                                           ---------------------
<S>                                                        <C>           <C>
Federal Home Loan Bank Stock, at cost ..............       $21,450       $ 4,279
Other investments, at fair value ...................         3,544         3,703
                                                           ---------------------
                                                           $24,994       $ 7,982
                                                           =====================
</TABLE>
                                       58
<PAGE>


Realized gains and (losses) (in  thousands) on sales,  maturities and impairment
losses for the years ended December 31, 2005, 2004 and 2003 were as follows:

<TABLE>

                                                 2005         2004         2003
                                              ---------------------------------
<S>                                           <C>          <C>          <C>
Gross gains .............................     $ 1,228      $   380      $   173
Gross (losses) ..........................      (1,814)        (247)        (185)
                                              ---------------------------------
Net gains (losses) ......................     $  (586)     $   133      $   (12)
                                              =================================
Applicable income taxes (benefit) .......     $  (234)     $    53      $    (5)
                                              =================================
</TABLE>



Investments  in debt and equity  securities  with a carrying  value of  $275.609
million  and  $280.851  million  were  pledged at  December  31,  2005 and 2004,
respectively,  to secure public deposits,  repurchase agreements,  and for other
purposes as required or permitted by law.

The amortized cost and fair value of  investments in debt and marketable  equity
securities (in thousands) at December 31, 2005, by amortization  date, are shown
below.  Amortization  date is defined as call date if the security was purchased
at a premium or maturity date if purchased at a discount. Borrowers may have the
right to call or prepay obligations with or without call or prepayment penalties
and  certain  securities   require  principal   repayments  prior  to  maturity.
Therefore,  these securities and equity securities with no stated maturities are
not included in the following maturity summary.

<TABLE>

                                                                   Available-for-sale     Held-to-maturity
                                                                   -----------------------------------------
                                                                   Amortized    Fair    Amortized     Fair
                                                                      Cost     Value       Cost      Value
                                                                   -----------------------------------------
<S>                                                                <C>        <C>        <C>        <C>
Due in one year or less ........................................   $150,661   $149,893   $ 20,819   $ 20,681
Due after one year through five years ..........................    174,293    171,790     33,552     33,128
Due after five years through ten years .........................      4,077      4,160      4,920      4,694
Due after ten years ............................................        438        475        160        178
                                                                   -----------------------------------------
                                                                   $329,469   $326,318   $ 59,451   $ 58,681
Mortgage-backed securities .....................................     13,729     13,657     17,091     16,984
Marketable equity securities ...................................      2,551      3,112         --         --
                                                                   -----------------------------------------
          Total ................................................   $345,749   $343,087   $ 76,542   $ 75,665
                                                                   =========================================
</TABLE>

5.   Loans

A summary of loans (in thousands),  by classification,  at December 31, 2005 and
2004 is as follows:

<TABLE>

                                                          2005            2004
                                                      --------------------------
<S>                                                   <C>             <C>
Commercial, financial, and agricultural ........      $  319,861      $  314,657
Real Estate - Commercial .......................         469,506         309,830
Real Estate - Residential ......................         140,304          62,464
Installment and consumer .......................          86,728          83,926
                                                      --------------------------
                                                      $1,016,399      $  770,877
Less:
   Allowance for loan losses ...................          13,472           9,650
                                                      --------------------------
                                                      $1,002,927      $  761,227
                                                      ==========================
</TABLE>

The Company makes  commercial,  financial,  and  agricultural;  commercial  real
estate; residential real estate; and installment and consumer loans to customers
located  in central  Illinois  and the  surrounding  communities.  As such,  the
Company  is  susceptible  to  changes  in the  economic  environment  in central
Illinois.

                                       59
<PAGE>

The loan portfolio  includes a concentration  of loans in commercial real estate
amounting to $459.506  million and $309.830  million at of December 31, 2005 and
2004, respectively.  The loans are expected to be repaid from cash flows or from
proceeds from the sale of selected assets of the borrowers. The concentration of
credit with commercial real estate is taken into  consideration by management in
determining  the  allowance  for loan losses.  The  Company's  opinion as to the
ultimate  collectibility of these loans is subject to estimates regarding future
cash flows from  operations  and the value of the  property,  real and personal,
pledged as  collateral.  These  estimates  are  affected  by  changing  economic
conditions and the economic prospects of the borrowers.

During 2005,  2004 and 2003,  the Company sold  approximately  $65.334  million,
$76.864  million and $209.192  million,  respectively,  of residential  mortgage
loans in the secondary market with servicing  released on approximately  $19.982
million, $28.860 million and $50.595 million, respectively. Capitalized mortgage
servicing  rights  totaled  $1.311 million and $992,000 at December 31, 2005 and
2004,  respectively.  The fair values of these  rights  were $1.938  million and
$1.378  million at December  31,  2005 and 2004,  respectively.  An  independent
evaluation  was performed on the loan  portfolio to assess the fair value of the
servicing rights in each year reported.

Mortgage  loans  serviced  for  others  are  not  included  in the  accompanying
consolidated financial statements.  The unpaid balances of these loans consisted
of the following (in thousands) at December 31, 2005, 2004 and 2003:

                                                  2005        2004        2003
                                                --------------------------------
Fannie Mae .................................    $186,840    $196,174    $191,505
Freddie Mac ................................      81,643       9,564      10,287
Illinois Housing Development Authority .....         758         939       1,219

In the  normal  course  of  business,  loans  are made to  directors,  executive
officers,  and  principal  shareholders  of the Company and to parties which the
Company or its directors,  executive officers, and shareholders have the ability
to  significantly  influence  its  management  or  operating  policies  (related
parties). The terms of these loans, including interest rates and collateral, are
similar to those prevailing for comparable transactions with other customers and
do not involve more than a normal risk of  collectibility.  Activity  associated
with loans (in thousands) made to related parties during 2005 was as follows:

                                                                        2005
                                                                   ------------
Balance, January 1                                                 $    40,408
Change of relationship                                                   3,663
New loans                                                               22,314
Repayments                                                             (13,718)
                                                                   ------------
Balance, December 31                                               $    52,667
                                                                   ============

At  December  31,  2005  one to  four  family  real  estate  mortgage  loans  of
approximately  $180.088 million were pledged to secure advances from the Federal
Home Loan Bank.

Activity in the allowance for loan losses (in thousands) for 2005, 2004 and 2003
was as follows:

                                                   2005        2004        2003
                                               --------------------------------
Balance, beginning of year .................   $  9,650    $  9,786    $  9,259
Balance, acquisition of Citizens ...........   $  3,434    $     --    $     --
Provision charged to expense ...............      1,530       1,100       1,470
Loans charged off ..........................     (1,459)     (1,692)     (1,640)
Recoveries on loans previously charged off .        317         456         697
                                               --------------------------------
Balance, end of year .......................   $ 13,472    $  9,650    $  9,786
                                               ================================

                                       60
<PAGE>

The following table presents summary data on nonaccrual and other impaired loans
(in thousands) at December 31, 2005, 2004 and 2003:

                                                          2005     2004     2003
                                                        ------------------------
Impaired loans on nonaccrual ........................   $1,144   $1,126   $  130
Impaired loans continuing to accrue interest ........      324    1,005      288
                                                        ------------------------
Total impaired loans ................................   $1,468   $2,131   $  418
                                                        ========================
Other non-accrual loans not classified
   as impaired ......................................   $1,090   $  563   $  269
                                                        ========================
Loans contractually past due 90 days or
   more, still accruing interest and not classified
   as impaired ......................................   $  664   $  547   $  590
                                                        ========================
Allowance for loan losses on impaired loans .........   $  374   $  491   $   63
                                                        ========================
Impaired loans for which there is no related
   allowance for loan losses ........................   $  545   $  863   $   --
                                                        ========================
Average recorded investment in impaired
   loans ............................................   $2,005   $2,336   $  847
                                                        ========================
Interest income recognized from impaired
   loans ............................................   $   67   $   68   $   13
                                                        ========================
Cash basis interest income recognized from
   impaired loans ...................................   $   34   $   16   $   10
                                                        ========================
6.   Premises and Equipment

A summary of premises and equipment (in thousands) at December 31, 2005 and 2004
is as follows:

                                                               2005        2004
                                                             -------------------
Land ...................................................     $ 7,257     $ 4,488
Furniture and equipment ................................      15,191      14,715
Buildings and leasehold improvements ...................      28,517      24,431
                                                             -------------------
                                                             $50,965     $43,634
Less: accumulated depreciation and amortization ........      27,918      26,547
                                                             -------------------
                                                             $23,047     $17,087
                                                             ===================

The  Company  leases   various   operating   facilities   and  equipment   under
noncancellable  operating  lease  arrangements.  These leases  expire at various
dates through  November 2010 and have renewal  options to extend the lease terms
for various dates.  The rental expense for these operating  leases was $270,000,
$222,000 and $218,000 in 2005, 2004 and 2003, respectively.

Minimum  annual  rental  payments   required  under  the  operating  leases  (in
thousands),  which  have  initial  or  remaining  terms in excess of one year at
December 31, 2005 are as follows:

2006                    $266
2007                     189
2008                      16
2009                      12
2010                       9
                        ----
                        $492
                        ====

7.   Deposits

The  aggregate  amount of time  certificate  of  deposits  in  denominations  of
$100,000 or more was $130.203  million and $107.125 million at December 31, 2005
and 2004,  respectively.  As of December 31, 2005,  the scheduled  maturities of
time deposits (in thousands) were as follows:

2006                        $330,335
2007                          84,915
2008                          35,000
2009                          13,810
2010 and thereafter           10,397
                            --------
                            $474,457
                            ========

                                       61
<PAGE>

8.   Federal Funds Purchased, Repurchase Agreements, and Notes Payable

A summary of short-term  borrowings (in thousands) at December 31, 2005 and 2004
is as follows:

                                                              2005         2004
                                                           ---------------------
Federal funds purchased ..............................     $  4,100     $  3,300
Securities sold under agreements to repurchase .......      114,352       93,600
                                                           ---------------------
                                                           $118,452     $ 96,900
                                                           =====================

Information  relating to  short-term  borrowings  (dollars in  thousands)  is as
follows:

<TABLE>

                                                      2005           2004           2003
                                                  -----------------------------------------
<S>                                               <C>            <C>            <C>
Federal funds purchased:
  Average daily balance .......................   $     5,869    $     3,515    $     5,004
  Maximum balance at month-end ................   $    24,225    $     5,575    $     7,550
  Weighted average interest rate at year-end ..         3.56%          1.75%          0.56%
  Weighted average interest rate for the year .         3.08%          0.94%          0.81%

Securities sold under agreements to repurchase:
  Average daily balance .......................   $   109,810    $    93,246    $    89,261
  Maximum balance at month-end ................   $   119,845    $   112,052    $   100,448
  Weighted average interest rate at year-end ..         3.31%          1.65%          1.06%
  Weighted average interest rate for the year .         2.66%          1.32%          1.17%

</TABLE>


The securities  underlying the agreements to repurchase are under the control of
the Bank.

9.   Federal Home Loan Bank Advances and Other Borrowings

A summary  of  Federal  Home  Loan Bank  (FHLB)  advances  and other  borrowings
(dollars in thousands) at December 31, 2005 and 2004 is as follows:


                                             December 31
                         -------------------------------------------------------
                                           2005                           2004
                         -------------------------------------------------------
                                                              Weighted
                           FHLB       Other                   Average
                         Advances   Borrowings     Total        Rate      Total
                         -------------------------------------------------------
Maturing in year ending:
  2005                   $    --     $    --     $     --          --    $    93
  2006                    28,387       1,523       29,910       3.55%      7,221
  2007                     2,430          23        2,453       6.83%      2,545
  2008                    29,000       6,023       35,023       5.25%     20,023
                         -------------------------------------------------------
                         $59,817     $ 7,569     $ 67,386       4.56%   $ 29,882
                         =======================================================

The terms of a security  agreement  with the FHLB  require the Bank to pledge as
collateral for advances both qualifying  first mortgage loans in an amount equal
to at least  167% of these  advances  and all  stock of the FHLB.  Advances  are
subject to restrictions or penalties in the event of prepayment. At December 31,
2005,  the  Company  had  sufficient  borrowing  capacity to permit it to borrow
additional  funds from the FHLB at a rate equal to the  FHLB's  current  advance
rates.

The other  borrowings  included  $7.500 million to help fund the  acquisition of
Citizens and general  operating  needs and $69,000 for the purchase of the land.
Of the $7.500  million,  $6.000  million  was a term loan due March 31, 2008 and
floats  quarterly  based on the 90-day  LIBOR rate plus 1.15%.  The loan rate at
December 31, 2005 was 5.67%.  The remaining  $1.500 million were advances on the
Company's line of credit (see Note 10 below). The land was originally  purchased
in 1999 at a cost of $266,000, with principal of $23,000 and annual interest due
March 8th of each year  until the  balance  has been paid in full.  Interest  is
based on the prime rate at March 8th of each year. The rate at December 31, 2005
was 5.50%.

                                       62
<PAGE>

10.  Line of Credit

The  Company has an  unsecured  line of credit of $15.000  million  from a third
party lender.  As of December 31, 2005, the Company had borrowed  $1.000 million
at 5.58% and $500,000 at 5.52%,  both of which were paid off in January 2006. As
of December 31, 2005, $13.500 million of this line was available.


11.  Income Taxes

Income tax expense  (in  thousands)  for 2005,  2004 and 2003 is  summarized  as
follows:

                                       2005              2004             2003
                                    -------------------------------------------

Federal ...................         $  9,560          $  7,029         $  8,480
State .....................              826               806              998
                                    -------------------------------------------
     Current ..............           10,386             7,835            9,478
Deferred ..................              (13)              208             (637)
                                    -------------------------------------------
     Total ................         $ 10,373          $  8,043         $  8,841
                                    ===========================================

Actual income tax expense (in thousands) for 2005, 2004 and 2003 differ from the
"expected" income taxes (computed by applying the maximum U.S. federal corporate
income tax rate of 35% to earnings before income taxes) as follows:

                                                 2005         2004         2003
                                             -----------------------------------
Computed "expected" income taxes ........    $ 10,038     $  7,987     $  8,906
Tax-exempt interest income, net of
  disallowed interest expense ...........        (488)        (607)        (744)
State tax, net of federal benefit .......         537          524          649
Other, net ..............................         286          139           30
                                             -----------------------------------
                                             $ 10,373     $  8,043     $  8,841
                                             ==================================

The tax  effects  of  temporary  differences  (in  thousands)  that give rise to
significant  portions of the deferred  tax assets and deferred tax  liabilities,
included in other assets, at December 31, 2005 and 2004 are as follows:

                                                               2005       2004
                                                             ------------------
Deferred tax assets:
  Unrealized holding loss on available-for-sale securities   $ 1,065    $   145
  Allowance for loan losses ..............................     5,238      3,835
  Deferred compensation ..................................     1,943      1,622
  Other employee benefits ................................       348        310
  Phantom stock ..........................................       242        253
  Net Operating Loss Carryforward ........................       148         --
  Other ..................................................       434        271
                                                             ------------------
            Total deferred tax assets ....................   $ 9,418    $ 6,436
                                                             ------------------
Deferred tax liabilities:
  Premises and equipment .................................   $  (817)   $  (373)
  Mortgage servicing rights ..............................      (481)      (348)
  Deferred loan fees .....................................      (394)      (369)
  Discount accretion .....................................       (75)       (56)
  FHLB Stock Dividend ....................................    (1,867)      (459)
  Prepaid Expenses .......................................      (258)      (222)
  Purchase Accounting ....................................    (1,286)        --
                                                             ------------------
            Total deferred tax liabilities ...............   $(5,178)   $(1,827)
                                                             ------------------
            Net deferred tax assets ......................   $ 4,240    $ 4,609
                                                             ==================

At December 31, 2005, the Company had Federal net operating  loss  carryforwards
of approximately  $423,000 for income tax purposes.  The difference between book
and tax net operating income results from interest income from certain loans and
investments  which are exempt for state income tax  purposes.  The net operating
loss carryforwards expire through 2024.

12.  Retirement Plans

The  Company  has  established  a profit  sharing  plan  and a  401(k)  plan for
substantially  all employees who meet the eligibility  requirements.  The 401(k)
plan allowed for participant  contributions  up to the maximum amount allowed by
IRS  regulations,  of which,  the first 6% of gross salary was available for the
Company's  50%  match.  The  profit  sharing  plan  is   non-contributory.   All
contributions  to the profit  sharing plan are at the discretion of the Company.
Contributions  by the Company totaled $1.101 million,  $927,000 and $887,000 for
2005, 2004 and 2003, respectively.

                                       63
<PAGE>
Certain key officers and directors  participate in various deferred compensation
or supplemental  retirement agreements with the Company. The Company accrues the
liability  for these  agreements  based on the  present  value of the amount the
employee or  director is  currently  eligible to receive.  The Company  recorded
expenses  of  $281,000,   $277,000   and  $288,000  in  2005,   2004  and  2003,
respectively,  related to these  agreements.  At December 31, 2005 and 2004, the
Company had a recorded  liability in the amount of approximately  $3.868 million
and $3.769 million, respectively for these plans. The Company has purchased life
insurance   policies,   which  are  reported  as  other  assets,  to  cover  the
aforementioned  liabilities  and other  employee  benefits,  with  recorded cash
surrender  values in 2005 and 2004 of  approximately  $10.533 million and $5.852
million, respectively.

Additionally,   in  connection  with  the  merger  of   BankIllinois   Financial
Corporation  and  First  Decatur  Bancshares,  Inc.,  the  Company  assumed  the
outstanding liability for a deferred compensation plan for nonemployee directors
of the Company which allowed participating directors to defer directors' fees in
a fixed income fund or, alternatively, in the form of "phantom stock units." For
directors  that  elected  to receive  phantom  stock,  a  deferred  compensation
account,  included in other  liabilities on the consolidated  balance sheet, was
credited with phantom stock units. After the merger, no additional contributions
were  allowed to these  plans,  however,  phantom  stock  units  continue  to be
increased by any dividends or stock splits declared by the Company.  At December
31, 2005 and 2004, $296,000 and $305,000 had been deferred for the phantom stock
plan, which  represented  20,708 and 21,977 phantom stock units. At December 31,
2005 and 2004,  the Company had a recorded  liability  in the amount of $618,000
and $651,000, respectively for these plans.

Additionally,  in connection  with the  acquisition of Citizens First  Financial
Corp., the Company assumed the outstanding  liability for the Director  Emeritus
Plan. At December 31, 2005,  the Company had a recorded  liability in the amount
of  $1.263  million  which is fully  funded  through  single  premium  insurance
annuities.

13.  Stock Options and Related Plans

In 2000,  after  the  merger of  BankIllinois  Financial  Corporation  and First
Decatur  Bancshares,  Inc. to form the Company,  the Company established a stock
incentive  plan,  which  provides for the  granting of options of the  Company's
common stock to certain  directors,  officers and employees.  This plan provides
for the granting of both qualified and non-qualified options.  Existing director
options  granted  prior to 2003 are fully  vested  and  exercisable  on the date
granted while  director  options  granted in or after 2003 vest, and thus become
exercisable,  ratably  over a one-year  period from the date  granted.  Existing
officer and employee options vest, and thus become  exercisable,  ratably over a
three-year  period from the date granted.  Under the 2000  incentive  plan,  the
Company has  outstanding  options of 767,413 shares and 1,359,018  shares remain
eligible  for  grant.  The  following  is a summary  of the  changes  in options
outstanding under the stock incentive and stock option plans:

<TABLE>
                                                        2005                          2004                        2003
                                             ------------------------------------------------------------------------------------
                                                             Grant                         Grant                       Grant
                                                             Price                         Price                       Price
                                              Shares         Range         Shares          Range        Shares         Range
                                             ------------------------------------------------------------------------------------
<S>                                          <C>        <C>                <C>        <C>              <C>        <C>
Options outstanding,
  beginning of year .....................    661,465    $17.50 - $30.60    581,780    $ 6.92 - $24.85   589,250   $ 6.92 - $19.76
Granted .................................    137,500    $28.80 - $29.60    140,500    $30.60 - $30.60   135,000   $24.80 - $24.85
Exercised ...............................    (22,886)   $17.50 - $24.80    (58,921)   $ 6.92 - $24.80  (142,470)  $ 6.92 - $24.80
Options forfeited .......................     (8,666)   $18.60 - $30.60     (1,894)   $18.60 - $30.60        --               --
                                             ------------------------------------------------------------------------------------
Options outstanding, end of year ........    767,413    $17.50 - $30.60    661,465    $17.50 - $30.60   581,780   $ 6.92 - $24.85
                                             ====================================================================================
Options exercisable, end of year ........    654,463    $17.50 - $30.60    547,769    $17.50 - $30.60   467,769   $ 6.92 - $24.85
                                             ====================================================================================
Weighted average fair value
     of options granted                                          $4.71                         $ 5.39                      $ 3.96
                                                                 =====                         ======                      ======
</TABLE>
                                       64
<PAGE>

<TABLE>
                                Options Outstanding                                    Options Exercisable
------------------------------------------------------------------------------------------------------------
                                                               Weighted
                                                  Outstanding   average    Weighted   Exercisable   Weighted
     Range                                          as of      remaining    average      as of       average
      of                                          December 31, contractual exercise   December 31,  exercise
Exercise price                                       2005         life       price       2005         price
------------------------------------------------------------------------------------------------------------
<S>                                               <C>          <C>         <C>        <C>          <C>
$17.50 - $17.50 .................................   130,530        4.8 $     17.50       130,530   $   17.50
$18.37 - $18.60 .................................   239,196        5.1       18.50       239,196       18.50
$24.80 - $24.85 .................................   127,846        7.0       24.80       121,840       24.80
$28.80 - $30.60 .................................   269,841        8.4       30.10       162,897       30.22
                                                  ----------------------------------------------------------
                                                    767,413        6.5 $     23.46       654,463   $   22.39
                                                  ==========================================================
</TABLE>

14.  Dividend Restrictions

Federal and state banking  regulations  place certain  restrictions on dividends
paid  and  loans or  advances  made by the Bank to the  Company.  Without  prior
approval, the Bank is restricted by Illinois law and regulations of the Illinois
Department  of Financial and  Professional  Regulation  and the Federal  Deposit
Insurance  Corporation  as to the maximum  amount of dividends it can pay to its
parent  to the  balance  of the  retained  earnings  account,  as  adjusted  (as
defined).  At December 31, 2005,  the Bank had  available  retained  earnings of
approximately  $51.826  million for the payment of dividends  without  obtaining
prior  regulatory  approval.  In  addition,  dividends  paid by the  Bank to the
Company would be prohibited if the effect thereof would cause the Bank's capital
to be reduced below applicable minimum capital requirements.

15.  Condensed Financial Information of Parent Company

Following are the condensed  balance sheets as of December 31, 2005 and 2004 and
the related  condensed  statements  of income and cash flows for the years ended
December 31, 2005, 2004 and 2003 for Main Street Trust, Inc.:



                            Condensed Balance Sheets
                                 (in thousands)
                                                            2005          2004
                                                          ----------------------
Assets:
  Cash .............................................      $    342      $  9,208
  Investment in Bank ...............................       136,399        91,182
  Investment in FirsTech ...........................         3,264         3,739
  Investment in other securities ...................         6,303         9,571
  Loans, net of allowance for loan losses ..........         2,682            --
  Other assets .....................................         6,000         7,648
                                                          ----------------------
                                                          $154,990      $121,348
                                                          ======================

Liabilities and shareholders' equity:
  Dividend payable .................................      $  2,334      $  2,079
  Other borrowings .................................         7,500         2,268
  Other liabilities ................................         1,387         3,026
  Shareholders' equity .............................       143,769       113,975
                                                          ----------------------
                                                          $154,990      $121,348
                                                          ======================


                                       65
<PAGE>


                         Condensed Statements of Income
                                 (in thousands)

<TABLE>

                                                      2005        2004       2003
                                                   --------------------------------
<S>                                                <C>         <C>        <C>
Revenue:
  Equity in net income of subsidiaries .........   $  18,512   $ 15,688   $ 17,029
  Interest income on deposits ..................         174        102         77
  Income on securities .........................       1,622        395        389
  Interest income on loans .....................         139         --         --
  Securities transactions, net .................        (598)        (1)      (106)
  Other ........................................           6      4,698      4,759
                                                   -------------------------------
      Total revenue .............................     19,855     20,882     22,148
                                                   -------------------------------
Expenses:
  Salary and benefits ..........................          17      4,433      4,066
  Interest expense on other borrowings .........         343         74         21
  Other ........................................       1,349      2,226      1,742
                                                   -------------------------------
      Total expenses ............................      1,709      6,733      5,829

      Income before applicable income tax benefit     18,146     14,149     16,319
                                                   --------------------------------
Applicable income tax benefit ...................       (162)      (629)      (286)
                                                   --------------------------------
          Net income ............................  $  18,308   $ 14,778   $ 16,605
                                                   ================================
</TABLE>

                       Condensed Statements of Cash Flows
                                 (in thousands)
<TABLE>
                                                                           2005        2004        2003
                                                                         --------------------------------
<S>                                                                      <C>         <C>         <C>
Cash flows from operating activities:
  Net income .........................................................   $ 18,308    $ 14,778    $ 16,605
  Adjustments to reconcile net income to net
    cash provided by operating activities:
    Distributions in excess of (less than) net income of subsidiaries       7,488      (5,688)     30,371
    Depreciation ....................................................          53         386         482
    Other, net ......................................................       2,073        (509)     (2,043)
                                                                         --------------------------------
          Net cash provided by operating activities: ..................    27,922       8,967      45,415
                                                                         --------------------------------
Cash flows from investing activities:
  Acquisition of Citizens First Financial Corporation ................    (28,738)         --          --
  Securities transactions, net .......................................      3,065        (273)       (462)
  Proceeds from sales of premises and equipment ......................        558          --          --
  Net decrease in loans ..............................................        780          --          --
  Purchases of premises and equipment ................................         (2)       (316)     (1,348)
                                                                         --------------------------------
         Net cash used in investing activities ........................   (24,337)       (589)     (1,810)
                                                                         --------------------------------
Cash flows from financing activities:
  Stock transactions, net ............................................     (6,013)     (1,956)    (30,111)
  Proceeds from other borrowings, net ................................      2,233          --       2,268
  Cash dividends paid ................................................     (8,671)     (7,972)     (7,142)
  Other, net .........................................................         --         (83)        (66)
                                                                         --------------------------------
         Net cash used in financing activities ........................   (12,451)    (10,011)    (35,051)
                                                                         --------------------------------
         Net increase (decrease) in cash and cash equivalents .........    (8,866)     (1,633)      8,554

Cash at beginning of year .............................................     9,208      10,841       2,287
                                                                         --------------------------------
Cash at end of year ...................................................  $    342    $  9,208    $ 10,841
                                                                         ================================
</TABLE>
                                       66
<PAGE>

16.  Quarterly Results of Operations (Unaudited) (in thousands, except per share
     data)
<TABLE>

                                                                                   Year Ended December 31, 2005
                                                                                        Three Months Ended:
                                                                     -----------------------------------------------------
                                                                     December 31  September 30     June 30       March 31
                                                                     -----------------------------------------------------
<S>                                                                    <C>           <C>           <C>           <C>
Interest income ....................................................   $21,354       $21,116       $20,131       $14,391
Interest expense ...................................................     8,495         7,550         6,941         4,493
                                                                       -------------------------------------------------
     Net interest income ...........................................    12,859        13,566        13,190         9,898
Provision for losses on loans ......................................       450           450           300           330
                                                                       -------------------------------------------------
     Net interest income after
       provision for losses
       on loans ....................................................    12,409        13,116        12,890         9,568
Non-interest income ................................................     5,106         5,298         5,058         5,015
Non-interest expense ...............................................    10,465        10,311        10,554         8,449
                                                                       -------------------------------------------------
     Income before income taxes ....................................     7,050         8,103         7,394         6,134
Income taxes .......................................................     2,553         2,952         2,667         2,201
                                                                       -------------------------------------------------
     Net income ....................................................   $ 4,497       $ 5,151       $ 4,727       $ 3,933
                                                                       =================================================
Basic earnings per share ...........................................   $  0.44       $  0.50       $  0.46       $  0.42
                                                                       =================================================
Diluted earnings per share .........................................   $  0.44       $  0.50       $  0.45       $  0.41
                                                                       =================================================

                                                                                   Year Ended December 31, 2004
                                                                                        Three Months Ended:
                                                                     -----------------------------------------------------
                                                                     December 31  September 30     June 30       March 31
                                                                     -----------------------------------------------------
Interest income ....................................................   $14,498       $13,663       $13,263       $13,381
Interest expense ...................................................     4,568         4,384         4,018         3,882
                                                                       -------------------------------------------------
     Net interest income ...........................................     9,930         9,279         9,245         9,499
Provision for losses on loans ......................................       110           330           330           330
                                                                       -------------------------------------------------
     Net interest income after
       provision for losses
       on loans ....................................................     9,820         8,949         8,915         9,169
Non-interest income ................................................     4,570         4,958         5,172         5,147
Non-interest expense ...............................................     8,922         8,442         8,318         8,197
                                                                       -------------------------------------------------
     Income before income taxes ....................................     5,468         5,465         5,769         6,119
Income taxes .......................................................     1,906         1,910         2,051         2,176
                                                                       -------------------------------------------------
     Net income ....................................................   $ 3,562       $ 3,555       $ 3,718       $ 3,943
                                                                       =================================================
Basic earnings per share ...........................................   $  0.38       $  0.38       $  0.39       $  0.41
                                                                       =================================================
Diluted earnings per share .........................................   $  0.37       $  0.37       $  0.39       $  0.41
                                                                       =================================================
</TABLE>


17.  Disclosures About Commitments and Financial Instruments

The Company 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.  Those instruments  involve, to varying degrees,  elements of
credit  and  interest  rate  risk  in  excess  of  amounts   recognized  in  the
consolidated  balance  sheets.  The  contractual  amounts  of those  instruments
reflect  the extent of  involvement  the Company  has in  particular  classes of
financial instruments.

                                       67
<PAGE>

The  Company's  exposure  to credit loss in the event of  nonperformance  by the
other party to the financial  instrument  for  commitments  to extend credit and
standby  letters of credit is  represented  by the  contractual  amount of those
instruments. The Company uses the same credit policies in making commitments and
conditional obligations as it does for on-balance-sheet instruments.  Management
does not anticipate any significant losses as a result of these transactions.

The following table summarizes  these financial  instruments and commitments (in
thousands) at December 31, 2005 and 2004:

                                                             2005         2004
                                                           ---------------------
Financial instruments whose contract amounts
   represent credit risk:
      Commitments ....................................     $279,647     $239,074
      Standby letters of credit ......................       34,512       33,897


The  acquisition  of  Citizens  resulted  in an  additional  $21.351  million in
commitments  and $549,000 in  additional  standby  letters of credit at April 1,
2005.

The majority of  commitments  are  agreements  to extend credit to a customer as
long as there is no  violation of any  condition  established  in the  contract.
Commitments,   principally   variable  interest  rates,   generally  have  fixed
expiration dates or other termination  clauses and may require payment of a fee.
Since many of the  commitments  are expected to expire without being drawn upon,
the  total  commitment   amounts  do  not  necessarily   represent  future  cash
requirements.  For  commitments  to extend  credit,  the Company  evaluates each
customer's  creditworthiness  on a case-by-case  basis. The amount of collateral
obtained,  if deemed necessary by the Company upon extension of credit, is based
on  management's  credit  evaluation.  Collateral  held varies,  but may include
accounts   receivable;   inventory;   property,   plant   and   equipment;   and
income-producing commercial properties. Also included in commitments at December
31, 2005 was $2.330 million to purchase other equity securities.

Standby  letters of credit  are  conditional  commitments  issued by the Bank to
guarantee the performance of a customer to a third party.  Those  guarantees are
primarily  issued to support  public and  private  borrowing  arrangements  and,
generally,  have terms of one year or less.  The credit risk involved in issuing
letters of credit is  essentially  the same as that  involved in extending  loan
facilities to customers.  The Bank may hold  collateral,  which include accounts
receivables, inventory, property and equipment, and income producing properties,
supporting those  commitments,  if deemed  necessary.  In the event the customer
does not perform in accordance  with the terms of the  agreement  with the third
party, the Bank would be required to fund the commitment.  The maximum potential
amount of future  payments the Bank could be required to make is  represented by
the contractual  amount shown in the summary above. If the commitment is funded,
the Bank would be entitled to seek recovery  from the customer.  At December 31,
2005 and 2004,  no amounts  have been  recorded  as  liabilities  for the Bank's
potential obligations under these guarantees.

Following is a summary of the carrying  amounts and fair values of the Company's
financial instruments at December 31, 2005 and 2004:

<TABLE>

                                                                           2005                     2004
                                                                --------------------------------------------------
                                                                  Carrying       Fair       Carrying       Fair
                                                                   amount        Value       amount        Value
                                                                --------------------------------------------------
<S>                                                              <C>          <C>          <C>          <C>
Assets:
  Cash and cash equivalents ..................................   $   94,066   $   94,066   $   64,928   $   64,928
  Investments in debt and equity securities ..................      444,623      443,746      358,726      358,661
  Mortgage loans held for sale ...............................        1,661        1,661        1,005        1,005
  Loans ......................................................    1,002,927    1,000,301      761,227      761,763
  Accrued interest receivable ................................        8,461        8,461        6,570        6,570
Liabilities:
  Deposits ...................................................   $1,275,972    1,272,296   $  974,577   $  963,413
  Federal funds purchased, repurchase agreements,
    and notes payable ........................................      118,452      118,436       96,900       96,855
  FHLB advances and other borrowings .........................       67,386       67,559       29,882       30,650
  Accrued interest payable ...................................        4,657        4,657        2,601        2,601


</TABLE>

                                       68
<PAGE>


Management's fair value estimates,  methods, and assumptions are set forth below
for the Company's financial instruments.

Cash and Cash Equivalents

The carrying value of cash and cash equivalents  approximates  fair value due to
the  relatively  short period of time between the  origination of the instrument
and its expected realization.

Investments in Debt and Equity Securities

The fair value of investments in debt and equity  securities is estimated  based
on bid prices received from securities dealers.  Venture capital investments are
valued at fair value based upon their financial statements. FHLB stock is valued
at cost which approximates fair value.

Mortgage Loans Held For Sale

Fair values of  mortgage  loans held for sale are based on  commitments  on hand
from investors or prevailing market prices.

Loans

Fair  values  are  estimated  for  portfolios  of loans with  similar  financial
characteristics.  Loans are  segregated by type such as  commercial,  commercial
real estate,  residential mortgage, and consumer.  Each loan category is further
segmented  into fixed and  adjustable  rate interest terms and by performing and
nonperforming  categories.  The fair value of performing  loans is calculated by
discounting  scheduled cash flows through the estimated maturity using estimated
market discount rates equal to rates at which loans,  similar in type,  would be
originated at December 31, 2005 and 2004.  Estimated  maturities  are based upon
the average remaining contractual lives for each loan classification. Fair value
for nonperforming loans is based on the use of discounted cash flow techniques.

Accrued Interest Receivable

The carrying value of accrued interest receivable approximates fair value due to
the  relatively  short period of time between the  origination of the instrument
and its expected realization.

Deposit Liabilities

The fair value of deposits with no stated maturity, such as non-interest bearing
and interest  bearing demand deposits and savings deposits is the amount payable
on demand.  The fair value of time deposits is based on the discounted  value of
contractual  cash flows.  The discount rate is estimated  using rates  currently
offered for deposits of similar remaining  maturities.  The fair value estimates
do not include the benefit that results  from the low-cost  funding  provided by
the deposit  liabilities  compared to the cost of borrowing  funds in the market
nor the benefit  derived  from the  customer  relationship  inherent in existing
deposits.

Federal Funds Purchased, Repurchase Agreements, and Notes Payable

The carrying values of federal funds purchased,  daily repurchase agreements and
notes payable, approximate fair value due to the relatively short period of time
between the origination of the instruments and their expected  realization.  The
fair value of term  repurchase  agreements is based on the  discounted  value of
contractual  cash flows.  The discount rate is estimated  using rates  currently
offered for comparable instruments of similar remaining maturities.

Federal Home Loan Bank Advances and Other Borrowings

The fair value of FHLB advances is based on the discounted  value of contractual
cash flows.  The discount rate is estimated using rates on current FHLB advances
with similar remaining maturities.

Accrued Interest Payable

The carrying value of accrued  interest payable  approximates  fair value due to
the  relatively  short period of time between the  origination of the instrument
and its expected realization.

Commitments to Extend Credit and Standby Letters of Credit

The fair value of commitments to extend credit is generally  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.  For fixed rate loan commitments,  fair value also considers the
difference between current levels of interest rates and the committed rates. The
fair value of letters of credit is based on fees  currently  charged for similar
agreements or on the estimated  cost to terminate  them or otherwise  settle the
obligations with the counterparties.  The estimated fair value of commitments to
extend credit and standby  letters of credit  approximates  the balances of such
commitments.

                                       69
<PAGE>
18.  Litigation

The Company and its  subsidiaries  are  involved in various  legal  proceedings,
claims and litigation arising out of the ordinary course of business.

It is the opinion of management that the  disposition or ultimate  resolution of
any other  claims and lawsuits  arising out of the  ordinary  course of business
will not have a material adverse effect on the consolidated  financial  position
of the Company.

19.  Regulatory Capital

The Company and its subsidiary  bank are subject to various  regulatory  capital
requirements  administered  by the  federal  banking  agencies.  Failure to meet
minimum  capital  requirements  can  initiate  certain  mandatory  and  possibly
additional discretionary actions by regulators that, if undertaken, could have a
direct  material  effect on the Company's and its  subsidiary  bank's  financial
statements.  Under capital adequacy guidelines and the regulatory  framework for
prompt  corrective  action,  banks must meet specific  capital  guidelines  that
involve   quantitative   measures   of   assets,   liabilities,    and   certain
off-balance-sheet items as calculated under regulatory accounting practices. The
Company's and its subsidiary 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  Company and its  subsidiary  bank to maintain  minimum  amounts and
ratios (set forth in the table below) of total and Tier I capital (as defined in
the regulations) to risk-weighted assets (as defined), and of Tier I capital (as
defined) to average assets (as defined). Management believes, as of December 31,
2005,  that the Company and its  subsidiary  bank exceeded all capital  adequacy
requirements to which they are subject.

As of December 31, 2005, the most recent  notifications  from primary regulatory
agencies categorized the Company's subsidiary bank as well capitalized under the
regulatory  framework for prompt  corrective  action.  To be categorized as well
capitalized,  banks must maintain minimum total capital to risk-weighted assets,
Tier I capital to  risk-weighted  assets,  and Tier I capital to average  assets
ratios as set forth in the table.  There are no  conditions or events since that
notification  that  management  believes  have  changed  any  of  the  Company's
subsidiary bank's categories.

The Company's and the Bank's  actual  capital  amounts and ratios as of December
31, 2005 and 2004 are presented in the following tables:
<TABLE>

                                                                                                             To be well capitalized
                                                                                     For capital adequacy   under prompt corrective
                                                                      Actual                purposes:         action provisions:
                                                               --------------------------------------------------------------------
                                                                Amount      Ratio      Amount      Ratio       Amount       Ratio
                                                               --------------------------------------------------------------------
<S>                                                            <C>          <C>       <C>          <C>      <C>            <C>
As of December 31, 2005:
  Total capital
    (to risk-weighted assets)
    Consolidated ...........................................   $135,368     11.7%     $ 92,324     8.0%     N/A
    Main Street Bank & Trust ...............................   $128,227     11.3%     $ 91,010     8.0%     $  113,762     10.0%
  Tier I capital
    (to risk-weighted assets)
    Consolidated ...........................................   $121,644     10.5%     $ 46,162     4.0%     N/A
    Main Street Bank & Trust ...............................   $114,652     10.1%     $ 45,505     4.0%     $   68,257      6.0%
  Tier I capital
    (to average assets)
    Consolidated ...........................................   $121,644      7.8%     $ 62,693     4.0%     N/A
    Main Street Bank & Trust ...............................   $114,652      7.4%     $ 62,162     4.0%     $   77,202      5.0%

As of December 31, 2004:
  Total capital
    (to risk-weighted assets)
    Consolidated ...........................................   $123,656     13.3%     $ 74,513     8.0%     N/A
    Main Street Bank & Trust ...............................   $101,381     11.1%     $ 73,008     8.0%     $   91,260     10.0%
  Tier I capital
    (to risk-weighted assets)
    Consolidated ...........................................   $113,691     12.2%     $ 37,257     4.0%     N/A
    Main Street Bank & Trust ...............................   $ 91,607     10.0%     $ 36,504     4.0%     $   54,756      6.0%
  Tier I capital
    (to average assets)
    Consolidated ...........................................   $113,691      9.2%     $ 49,595     4.0%     N/A
    Main Street Bank & Trust ...............................   $ 91,607      7.5%     $ 48,865     4.0%     $   61,801      5.0%
</TABLE>

                                       70
<PAGE>


Item 9. Changes in and Disagreements on Accounting and Financial Disclosure

        None.

Item 9a. Controls and Procedures

     A. Disclosure Controls

        As of the date of the end of the period covered by this Annual Report on
        Form 10-K, the Company  carried out an evaluation  under the supervision
        and with the  participation of the Company's  management,  including the
        Company's  Chief  Executive  Officer  along  with  the  Company's  Chief
        Financial  Officer,  of the effectiveness of the design and operation of
        the  Company's  disclosure  controls  and  procedures  pursuant  to Rule
        13a-15(b),  as adopted by the Securities and Exchange  Commission  (SEC)
        under the  Securities  Exchange Act of 1934 (Exchange  Act).  Based upon
        that  evaluation,  the Company's Chief Executive  Officer along with the
        Company's   Chief  Financial   Officer   concluded  that  the  Company's
        disclosure controls and procedures are effective to timely alert them to
        material information relating to the Company (including its consolidated
        subsidiaries)  required  to be included in the  Company's  periodic  SEC
        filings.

        Disclosure controls and procedures are the controls and other procedures
        that are designed to ensure that information required to be disclosed in
        the reports that the Company  files or submits under the Exchange Act is
        recorded,  processed,  summarized  and reported  within the time periods
        specified  in  the  SEC's  rules  and  forms.  Disclosure  controls  and
        procedures include, without limitation, controls and procedures designed
        to ensure that information  required to be disclosed in the reports that
        the Company files or submits under the Exchange Act is  accumulated  and
        communicated to management,  including the Chief  Executive  Officer and
        Chief  Financial  Officer,  as  appropriate,  to allow timely  decisions
        regarding required disclosure.

        There have been no changes in the  Company's  internal  controls,  or in
        other  factors which could  significantly  affect these  controls,  over
        financial  reporting that have  materially  affected,  or are reasonably
        likely  to  materially  affect,  the  Company's  internal  control  over
        financial reporting.

     B. Management's Report on Internal Control Over Financial Reporting

        The  management of Main Street Trust,  Inc. (the Company) is responsible
        for  establishing  and  maintaining   adequate   internal  control  over
        financial  reporting.  The  Company's  internal  control over  financial
        reporting is a process  designed under the  supervision of the Company's
        Chief  Executive  and Chief  Financial  officers  to provide  reasonable
        assurance  regarding  the  reliability  of financial  reporting  and the
        preparation of the Company's financial statements for external reporting
        purposes  in  accordance  with  U.S.   generally   accepted   accounting
        principles.

        As of December 31, 2005,  management  assessed the  effectiveness of the
        Company's  internal  control  ov%r  financial  reporting  based  on  the
        criteria  for  effective  internal  control  over  financial   reporting
        established in "Internal  Control - Integrated  Framework" issued by the
        Committee of Sponsoring Organizations of the Treadway Commission (COSO).
        Based  on  the  assessment,   management  determined  that  the  Company
        maintained  effective  internal  control over financial  reporting as of
        December 31, 2005, based on those criteria

        The Company  acquired  Citizens  First  Financial  and it's  subsidiary,
        Citizens  Savings  Bank  (Citizens)  on April 1,  2005  and  merged  the
        subsidiary banks at the close of business on October 7, 2005. Management
        has excluded from it's  assessment of the  effectiveness  of Main Street
        Trust,  Inc's internal  control over financial  reporting as of December
        31, 2005,  Citizen's internal control over financial  reporting included
        in the consolidated  financial  statements of Main Street Trust, Inc for
        the period of April 1, 2005 until October 8, 2005. While the acquisition
        was considered  material to the Company, it did not result in a material
        change in our internal controls over financial reporting.

        McGladrey & Pullen,  LLP, the independent  registered  public accounting
        firm that audited the consolidated  financial  statements of the Company
        included in this Annual Report on Form 10-K,  has issued an  attestation
        report on management's  assessment of the effectiveness of the Company's
        internal  control over financial  reporting as of December 31, 2005. The
        report, which expresses unqualified opinions on management's  assessment
        and  on  the  effectiveness  of  the  Company's  internal  control  over
        financial  reporting as of December  31, 2005,  is included in this Item
        under the heading "Report of Independent  Registered  Public  Accounting
        Firm."

                                       71
<PAGE>
McGladrey & Pullen, LLP
Certified Public Accountants

Report of Independent Registered Public Accounting Firm

To the Board of Directors
Main Street Trust, Inc.
Champaign, Illinois

We  have  audited   management's   assessment,   included  in  the  accompanying
Management's  Report on Internal  Control over  Financial  Reporting,  that Main
Street  Trust,  Inc.  maintained   effective  internal  control  over  financial
reporting  as of December 31, 2005,  based on criteria  established  in Internal
Control-   Integrated   Framework   issued  by  the   Committee  of   Sponsoring
Organizations  of the Treadway  Commission  (COSO).  Main Street  Trust,  Inc.'s
management  is  responsible  for  maintaining  effective  internal  control over
financial  reporting  and for its  assessment of the  effectiveness  of internal
control over financial reporting. Our responsibility is to express an opinion on
management's  assessment  and an opinion on the  effectiveness  of the Company's
internal control over financial reporting based on our audit.

We conducted  our audit in accordance  with the standards of the Public  Company
Oversight  Board  (United  States).  Those  standards  require  that we plan and
perform  the  audit to  obtain  reasonable  assurance  about  whether  effective
internal  control  over  financial  reporting  was  maintained  in all  material
respects. Our audit included obtaining an understanding of internal control over
financial reporting,  evaluating management's assessment, testing and evaluating
the design and operating  effectiveness of internal control, and performing such
other  procedures as we considered  necessary in the  circumstances.  We believe
that our audit provides a reasonable basis for our opinion.

A company's  internal control over financial  reporting is a process designed to
provide reasonable  assurance  regarding the reliability of financial  reporting
and the preparation of financial  statements for external purposes in accordance
with accounting principles generally accepted in the United States of America. A
company's internal control over financial  reporting includes those policies and
procedures  that (1) pertain to the  maintenance  of records that, in reasonable
detail,  accurately and fairly reflect the  transactions and dispositions of the
assets of the company;  (2) provide  reasonable  assurance that transactions are
recorded  as  necessary  to  permit  preparation  of  financial   statements  in
accordance with accounting principles generally accepted in the United States of
America, and the receipts and expenditures of the company are being made only in
accordance with  authorizations of management and directors of the company;  and
(3) provide  reasonable  assurance  regarding  prevention or timely detection of
unauthorized  acquisition,  use, or disposition of the company assets that could
have a material effect on the financial statements.

Because of its inherent  limitations,  internal control over financial reporting
may not prevent or detect misstatements.  Also, projections of any evaluation of
effectiveness to future periods are subject to the risk that controls may become
inadequate  because of changes in  conditions,  or that the degree of compliance
with the policies or procedures may deteriorate.

In our opinion,  management's assessment that Main Street Trust, Inc. maintained
effective internal control over financial  reporting as of December 31, 2005, is
fairly  stated,  in all  material  respects,  based on criteria  established  in
Internal  Control-  Integrated  Framework  issued by the Committee of Sponsoring
Organizations  of the Treadway  Commission  (COSO).  Also, in our opinion,  Main
Street Trust, Inc.  maintained,  in all material  respects,  effective  internal
control over  financial  reporting  as of December  31, 2005,  based on criteria
established in Internal Control- Integrated Framework issued by the Committee of
Sponsoring Organizations of the Treadway Commission (COSO).

The Company  acquired  Citizens First  Financial and its  subsidiary,  Citizens
Savings  Bank(Citizens)  on April 1, 2005 and merged the subsidiary banks at the
close of business on October 7, 2005.  Management  excluded from it's assessment
of the effectiveness of the Company's internal control over financial  reporting
as of December 31, 2005,  Citizen's  internal  control over financial  reporting
included in the consolidated  financial statements of Main Street Trust, Inc for
the period of April 1, 2005 until October 8, 2005. Our audit of internal control
over  financial  reporting of the Company  also  excluded an  evaluation  of the
internal  control over financial  reporting of Citizens from the period of April
1, 2005 to October 8, 2005.

We have also  audited,  in accordance  with the standards of the Public  Company
Oversight Board (United States),  the consolidated balance sheets of Main Street
Trust,  Inc. and  subsidiaries  as of December 31, 2005 and 2004 and the related
consolidated  statements of income,  changes in shareholders'  equity,  and cash
flows for each of the three years ended  December  31, 2005 and our report dated
March 7, 2006 expressed an unqualified opinion.

/s/ McGladrey & Pullen, LLP

Champaign, Illinois
March 7, 2006

McGladrey & Pullen, LLP is a member firm of RSM International -
an affiliation of separate and independent legal rights

                                       72
<PAGE>

Item 9b. Other Information

None.


                                    PART III

Item 10. Directors and Executive Officers of the Registrant

The  information  in the  Company's  2006  Proxy  Statement  under  the  caption
"Election of  Directors"  and under the caption  "Security  Ownership of Certain
Beneficial Owners and Management" is incorporated by reference.  The information
regarding  executive  officers not provided in the 2006 Proxy Statement is noted
below.

Executive Officers

The term of office for the executive officers of the Company is from the date of
election until the next annual organizational meeting of the Board of Directors.
In addition to the information  provided in the 2006 Proxy Statement,  the names
and ages of the  executive  officers of the Company as of December 31, 2005,  as
well as the offices of the Company and the  Subsidiaries  held by these officers
on that date,  and principal  occupations  for the past five years are set forth
below.

<TABLE>

Name                            Position with Main Street, its subsidiaries
(Age)                           and occupation for the last five years
----------------------------------------------------------------------------------------------
<S>                             <C>
Paul C. Donohue                 Executive Vice President of Sales & Marketing for Main
(Age 42)                        Street and Main Street Bank & Trust; General Manager,
                                WSMH-TV, Flint, MI (2003-2004); Station Manager, WICD-TV,
                                Champaign, IL (2001-2003)

Donna R. Greene                 Executive Vice President of Main Street and President
(Age 52)                        of Main Street Bank & Trust Wealth Management; Senior Vice
                                President and Certified Financial Planner with First Busey
                                Securities, Inc. (1998-2004)

Leanne C. Heacock               Executive Vice President, Management Information Systems
(Age 40)                        for Main Street and Main Street Bank & Trust and Director of
                                FirsTech; Executive Vice President, Management Information
                                Systems, BankIllinois and The First National Bank of Decatur
                                (2001-2002)

Howard F. Mooney II             President, FirsTech and Executive Vice President
(Age 41)                        for Main Street and Director of FirsTech;

Robert F. Plecki, Jr.           Executive Vice President of Main Street and
(Age 45)                        President of Main Street Bank & Trust Retail Banking;
                                President and Director of BankIllinois (2001-2004)

Christopher M. Shroyer          Executive Vice President of Main Street and President of
(Age 40)                        Main Street Bank & Trust Commercial Banking; President,
                                Chief Executive Officer and Director of The First National
                                Bank of Decatur (2001-2004)

David B. White                  Executive Vice President and Chief Financial Officer of
(Age 54)                        Main Street and Main Street Bank & Trust and Director of
                                FirsTech

Phillip C. Wise                 Executive Vice President of Main Street Bank & Trust and
(Age 67)                        Chairman of FirsTech; Director and Executive Vice President
                                of Main Street and Chairman of the Board of The First
                                National Bank of Decatur (2001-2004)
</TABLE>

Section 16(a) Beneficial Ownership Compliance

Section  16(a) of the  Securities  Exchange  Act  requires  that the  directors,
executive  officers  and persons who own more than 10% of our common  stock file
reports of ownership and changes in ownership  with the  Securities and Exchange
Commission.  These  persons  are also  required to furnish us with copies of all
Section 16(a) forms they file.  Based solely on our review of the copies of such
forms  furnished  to  us  and  representations  made  by  any  reporting  person
concerning  whether a Form 5 was required to be filed for 2004, we are not aware
of any failures to comply with the filing  requirements  of Section 16(a) during
2004 except for Mr. Kenney and Mr. Sloan, who each filed a Form 4 one day late.

Item 11. Executive Compensation

The  information  in the 2006  Proxy  Statement  under  the  caption  "Executive
Compensation" is incorporated by reference.

                                       73
<PAGE>

Item 12.  Security  Ownership Of Certain  Beneficial  Owners and  Management and
Related Shareholder Matters

The  information  in the  2006  Proxy  Statement  under  the  caption  "Security
Ownership of Certain  Beneficial  Owners and Management and Related  Shareholder
Matters" is incorporated by reference.

Equity Compensation Plan Information

The table below sets forth the following information as of December 31, 2005 for
all compensation plans previously  approved by our shareholders:

     (a)  the number of securities to be issued upon the exercise of outstanding
          options, warrants and rights;

     (b)  the  weighted-average  exercise  price  of such  outstanding  options,
          warrants and rights;

     (c)  other  than  securities  to  be  issued  upon  the  exercise  of  such
          outstanding  options,  warrants and rights,  the number of  securities
          remaining available for future issuance under the plans.



<TABLE>

                                                 EQUITY COMPENSATION PLAN INFORMATION

------------------------------------------------------------------------------------------------------------------------------------
                                      Number of securities to be
            Plan category               issued upon exercise of       Weighted-average exercise       Number of securities remaining
                                          outstanding options        price of outstanding options      available for future issuance
------------------------------------------------------------------------------------------------------------------------------------
<S>                                              <C>                           <C>                             <C>
Equity compensation plans approved
by security holders...............               767,413                       $23.46                          1,359,018

Equity compensation plans not
approved by security holders......                     0                            0                                  0

Total.............................               767,413                       $23.46                          1,359,018

</TABLE>

Item 13. Certain Relationships And Related Transactions

The information in the 2006 Proxy Statement under the caption "Transactions with
Management" is incorporated by reference.

Item 14. Principal Accountant Fees and Services

The  information  in the 2006 Proxy  Statement  under the  caption  "Independent
Registered Public Accounting Firm" is incorporated by reference.

                                     PART IV

Item 15. Exhibits and Financial Statement Schedules

         (a)(1) Index to Financial Statements

                See page 35.

         (a)(2) Financial Statement Schedules

                N/A

         (a)(3) Schedule of Exhibits

                The Exhibit Index which  immediately  follows the signature page
                to this Form 10-K is incorporated by reference.

         (b) Exhibits

                The  exhibits  required  to be filed  with  this  Form  10-K are
                included  with  this  Form  10-K  and  are  located  immediately
                following the Exhibit Index to this Form 10-K.


                                       74
<PAGE>


                             MAIN STREET TRUST, INC.

                                  EXHIBIT INDEX
                                       TO
                           ANNUAL REPORT ON FORM 10-K
<TABLE>

                                                       Incorporated
 Exhibit No.           Description                       Herein by                     Filed
                                                        Reference To                  Herewith
-------------- ---------------------------- ------------------------------------------------------
     <S>       <C>                          <C>                                       <C>
     3.1       Amended and Restated         Exhibit 3.1 to the Form S-4 filed
               Articles of Incorporation    with the Commission on December 23,
                                            2004 (SEC File No. 333-121579)

     3.2       Amendment to Articles of     Exhibit 3.2 to the Form S-4 filed
               Incorporation of Main        with the Commission on December 23,
               Street Trust, Inc.           2004 (SEC File No. 333-121579)

     3.3       Bylaws                       Exhibit 3.3 to the Form S-4 filed
                                            with the Commission on December 23,
                                            2004 (SEC File No. 333-121579)

     4.1       Specimen common stock        Exhibit 4.1 to the Form 10-K filed
               certificate                  with the Commission on March 30,
                                            2001 (SEC File No.000-30031)

     4.2       Second Amended and           Exhibit 4.2 to the Form 10-K filed
               Restated Shareholders'       with the Commission on March 30,
               Agreement, dated as of       2001 (SEC File No. 000-30031)
               November 1, 2000

    10.1       Employment Agreement by      Exhibit 10.1 to the Form 10-K filed
               and between the Company      with the Commission on March 29,
               and Gregory B. Lykins        2002 (SEC File No. 000-30031)

    10.2       Employment Agreement by      Exhibit 10.2 to the Form 10-K filed
               and between the Company      with the Commission on March 29,
               and Van A. Dukeman           2002 (SEC File No. 000-30031)

    10.3       Employment Agreement by      Exhibit 10.5 to the Registration
               and between the Company      Statement on Form S-4 filed with
               and David B. White           the Commission on March 15, 1996,
                                            as amended (SEC File No. 33-90342)

    10.4       Employment Agreement by      Exhibit 10.4 to the Form 10-K filed
               and between the Company,     with the Commission on March 29,
               FirsTech, Inc. and Phillip   2002 (SEC File No. 000-30031)
               C. Wise

    10.5       Employment Agreement by      Exhibit 10.5 to the Form 10-K filed
               and between The First        with the Commission on March 24,
               National Bank of Decatur     2003 (SEC File No. 000-30031)
               and Chris Shroyer

    10.6       Employment Agreement by      Exhibit 10.6 to the Form 10-K filed
               and between the Company      with the Commission on March 15,
               and Robert F. Plecki         2004 (SEC File No. 000-30031)

    10.7       Employment Agreement by      Exhibit 10.5 to the Form 10-K filed
               and between the Company      with the Commission on March 15,
               and Paul E. Donohue          2005 (SEC File No. 000-30031)

    10.8       Employment Agreement by      Exhibit 10.5 to the Form 10-K filed
               and between the Company      with the Commission on March 15,
               and Donna R. Greene          2005 (SEC File No. 000-30031)

    10.9       Main Street Trust, Inc.      Exhibit 10.1 to the Form S-8 filed
               2000 Stock Incentive Plan    with the Commission on November 29,
                                            2000 (SEC File No. 333-50890)

    10.10      Main Street Trust, Inc.      Exhibit 10.5 to the Form 10-K filed
               2000 Stock Incentive Plan    with the Commission on March 15,
               Director Stock Option        2005 (SEC File No. 000-30031)
               Agreement

    10.11      Main Street Trust, Inc.      Exhibit 10.5 to the Form 10-K filed
               2000 Stock Incentive Plan    with the Commission on March 15,
               Employee Stock Option        2005 (SEC File No. 000-30031)
               Agreement

    10.12      Credit Agreement dated as    Exhibit 10.1 to the Form 10-Q filed
               of March 31, 2005 between    with the Commission on May 10, 2005
               JP Morgan Chase Bank, N.A.   (SEC File No. 000-30031)
               and Main Street Trust, Inc.

                                       75
<PAGE>

    10.13      Main Street Trust, Inc.                                                   X
               Summary of Director
               Compensation

    10.14      Agreement and Plan of        Exhibit 2.1 to the Form S-4 filed
               Merger dated as of           with the Commission on December 23,
               December 7, 2004             2004 (SEC File No. 333-121579)

    21.1       Subsidiaries of the                                                       X
               Registrant

    23.1       Consent of McGladrey &                                                    X
               Pullen, LLP

    31.1       Certification of Chief                                                    X
               Executive Officer Pursuant
               to Rule 13a-14(a)/15d-14(a)

    31.2       Certification of Chief                                                    X
               Financial Officer Pursuant
               to Rule 13a-14(a)/15d-14(a)

    32.1       Certification of Chief                                                    X
               Executive Officer Pursuant
               to 18 U.S.C. Section 1350,
               as adopted Pursuant to
               Section 906 of the
               Sarbanes-Oxley Act of 2002

    32.2       Certification of Chief                                                    X
               Executive Officer Pursuant
               to 18 U.S.C. Section 1350,
               as adopted Pursuant to
               Section 906 of the
               Sarbanes-Oxley Act of 2002
</TABLE>

                                       76
<PAGE>

                                   SIGNATURES

Pursuant to the  requirements  of Section 13 of the  Securities  Exchange Act of
1934,  the  Registrant has duly caused this report to be signed on its behalf by
the undersigned, thereunto duly authorized on March 16, 2006.


By: /s/ Van A. Dukeman                        By:  /s/ David B. White
    -----------------------------                  ---------------------------
    Van A. Dukeman                                 David B. White
    President, CEO and Director                    Executive Vice President and
                                                   Principal Financial and
                                                   Accounting Officer

Pursuant to the requirements of the Securities Exchange Act of 1934, this report
has been signed below by the following persons on behalf of the Registrant and
in the capacities indicated on March 16, 2006.


/s/ Gregory B. Lykins
--------------------------------------
Gregory B. Lykins                                  Chairman and Director


/s/ Van A. Dukeman
--------------------------------------
Van A. Dukeman                                     President, CEO and Director


/s/ David J. Downey
--------------------------------------
David J. Downey                                    Director


/s/ Larry D. Haab
--------------------------------------
Larry D. Haab                                      Director


/s/ Frederic L. Kenney
--------------------------------------
Frederic L. Kenney                                 Director



--------------------------------------
August C. Meyer, Jr.                               Director


/s/ George T. Shapland
--------------------------------------
George T. Shapland                                 Director


/s/ Thomas G. Sloan
--------------------------------------
Thomas G. Sloan                                    Director


/s/ H. Gale Zacheis
--------------------------------------
H. Gale Zacheis                                    Director


                                       77