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, 2001

                        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 Exchange 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 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 amendment to this
Form 10-K. [ ]

The index to  exhibits is located on page 61 of 61 total  sequentially  numbered
pages.


<PAGE>

As of March 13,  2002,  the  Registrant  had issued and  outstanding  11,173,947
shares of the  Registrant's  Common  Stock.  The  aggregate  market value of the
voting stock held by  non-affiliates  of the Registrant as of March 13, 2002 was
approximately $143.3 million.*

*    Based on the last  reported  price  ($18.70)  of an actual  transaction  in
     Registrant's  Common  Stock on March 13,  2002,  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 Stock.

Documents Incorporated By Reference

Part III of Form 10-K -  Portions  of Proxy  Statement  for  annual  meeting  of
shareholders to be held May 14, 2002.
<PAGE>


                             MAIN STREET TRUST, INC.

                             Form 10-K Annual Report

                                Table of Contents

                                     Part I

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

Item 2.  Properties....................................................
Item 3.  Legal Proceedings.............................................
Item 4.  Submission of Matters to a Vote of Security Holders...........

                                     Part II

Item 5.  Market for Registrant's Common Equity and
           Related Shareholder Matters.................................
Item 6.  Selected Consolidated Financial Data..........................
Item 7.  Management's Discussion and Analysis of
           Financial Condition and Results of Operations...............
Item 7a. Quantitative and Qualitative Disclosures about Market Risk....
Item 8.  Financial Statements and Supplementary Data...................
Item 9.  Changes in and Disagreements on Accounting and Financial
           Disclosure .................................................

                                    Part III

Item 10. Directors and Executive Officers of the Registrant............
Item 11. Executive Compensation........................................
Item 12. Security Ownership of Certain Beneficial Owners and Management
Item 13. Certain Relationships and Related Transactions................

                                     Part IV

Item 14. Exhibits, Financial Statement Schedules and Reports
           on Form 8-K.................................................


<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
     on March 23, 2000,  the Company  acquired all of the  outstanding  stock of
     BankIllinois,   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.

     On August 12, 1999,  BankIllinois  Financial  Corporation and First Decatur
     Bancshares,  Inc.  entered  into an  agreement  and  plan of  merger  which
     provided for the merger of the two companies into the Company.  The merger,
     which was accounted  for as a pooling of interests,  was completed on March
     23, 2000. Accordingly,  prior period consolidated financial statements have
     been restated as though the prior  entities had been  consolidated  for all
     periods presented.

B.   Business of the Company and Subsidiaries

     General

     The Company  conducts  the  business of banking and offers  trust  services
     through  BankIllinois,  First National Bank of Decatur and First Trust Bank
     of  Shelbyville  (the  "Banks"),  and  retail  payment  processing  through
     FirsTech, Inc., its wholly owned subsidiaries. As of December 31, 2001, the
     Company had  consolidated  total  assets of $1.152  billion,  shareholders'
     equity  of  $136.0  million  and  trust  assets  under   administration  of
     approximately  $1.386  billion.  Substantially  all  of the  income  of the
     Company is currently  derived from dividends  received from the Banks.  The
     amount of these dividends is directly  related to the earnings of the Banks
     and is subject to various  regulatory  restrictions.  See  "Regulation  and
     Supervision."

     Banking Segment

     The  Banks  conduct  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 and time  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  the
     PrimeVest  Investment  Center at BankIllinois  and through Raymond James at
     First National Bank of Decatur and First Trust Bank of  Shelbyville,  which
     services include a broad spectrum of investment products, including stocks,
     bonds, mutual funds and tax advantaged investments.  In addition, the trust
     & investments  division  offers a wide range of services such as investment
     management,  acting as trustee, serving as guardian,  executor or agent and
     miscellaneous consulting.

     Commercial  lending at the Banks  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 Banks'
     loan  portfolios.  The  Banks'  retail  banking  divisions  make  loans  to
     consumers for various purposes, including home equity and automobile loans.
     The  consumer  mortgage  loan  departments,  which  are part of the  retail
     banking  divisions,  specialize  in real estate loans to  individuals.  The
     Banks also  purchase  installment  obligations  from  retailers,  primarily
     without recourse.

     The Banks'  principal  sources of income are interest and fees on loans and
     investments and service fees. Their principal expenses are interest paid on
     deposits and general operating expenses. The Banks' primary service area is
     Central Illinois.
<PAGE>

     Lending Activities

     General.  The Company's  primary source of revenue is interest revenue from
     lending activities.  See "MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
     CONDITION AND RESULTS OF  OPERATIONS--Results  of Operations--Net  Interest
     Income."

     Loan  Portfolio   Composition.   The  Company's   loan  portfolio   totaled
     approximately  $682.3  million at December  31, 2001,  representing  59% of
     total  assets at that  date.  At that  date,  the loan  portfolio  included
     approximately  $246.0  million of  commercial,  financial and  agricultural
     loans,   $316.7  million  of  real  estate  loans  and  $119.6  million  of
     installment and consumer loans. See  "MANAGEMENT'S  DISCUSSION AND ANALYSIS
     OF   FINANCIAL   CONDITION   AND   RESULTS   OF    OPERATIONS--Results   of
     Operations--Financial Condition--Loans."

     For a discussion  of risks with respect to the loan  portfolio,  strategies
     for addressing and managing such risks,  non-performing loans and allowance
     for loan losses,  see  "MANAGEMENT'S  DISCUSSION  AND ANALYSIS OF FINANCIAL
     CONDITION AND RESULTS OF OPERATIONS--Results of  Operations--Allowance  for
     Loan Losses and Loan Quality" and "--Financial Condition--Loans."

     Interest  Rates and Fees.  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 System
     (the  "Federal   Reserve"),   legislative  tax  policies  and  governmental
     budgetary matters.  See "MANAGEMENT'S  DISCUSSION AND ANALYSIS OF FINANCIAL
     CONDITION AND RESULTS OF  OPERATIONS--Results  of Operations--Net  Interest
     Income."

     Investment Securities

     The  carrying  value of  investment  securities  at  December  31, 2001 was
     approximately  $335.4  million,  representing  29% of the  Company's  total
     assets.  See "MANAGEMENT'S  DISCUSSION AND ANALYSIS OF FINANCIAL  CONDITION
     AND RESULTS OF OPERATIONS--Financial Condition--Investment Securities."

     Interest Rate Sensitivity

     For a  discussion  of the Banks'  approach to managing  its mix of interest
     rate sensitive assets and  liabilities,  see  "MANAGEMENT'S  DISCUSSION AND
     ANALYSIS OF  FINANCIAL  CONDITION  AND RESULTS OF  OPERATIONS  -- Financial
     Condition--Interest Rate Sensitivity."

     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;  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,
     2001,  2000  and  1999,  FirsTech,  Inc.  accounted  for  $7,678,000  (9%),
     $7,571,000 (8%), and $8,824,000  (10%),  respectively,  of the consolidated
     total revenues of the Company and accounted for $2,113,000 (9%), $1,722,000
     (9%), and $1,256,000 (7%), respectively,  of the consolidated income before
     income  tax of the  Company.  See  Note  2 to  the  Consolidated  Financial
     Statements for an analysis of segment operations.

     FirsTech,  Inc. provides retail lockbox  processing for  organizations.  In
     2001, remittance processing for these companies accounted for approximately
     42% of the total revenue of FirsTech, Inc.

     FirsTech,  Inc.  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 2001, the remittance  collection business
     for these companies accounted for approximately 53% of the total revenue of
     FirsTech, Inc.

     FirsTech,  Inc.  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,  Inc. The  principal  methods of  competition  in the  remittance
     processing industry are pricing of services,  use of technology and quality
     of service.
<PAGE>

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.  The  Company  competes  for real estate and other loans
     principally  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 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
     and  savings  institutions  located in the same  communities.  The  Company
     competes  for these  deposits by offering a variety of deposit  accounts at
     competitive  rates,   convenient   business  hours  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.  This may
     significantly  change the competitive  environment in which the Company and
     the Banks 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.

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.   Regulation and Supervision

     General

     Financial   institutions  and  their  holding   companies  are  extensively
     regulated under federal and state law. As a result, the growth and earnings
     performance of the Company can be affected not only by management decisions
     and general economic conditions, but also by the requirements of applicable
     state and federal  statutes  and  regulations  and the  policies of various
     governmental regulatory authorities, including the Illinois Commissioner of
     Banks and Real Estate (the  "Commissioner"),  the Office of the Comptroller
     of the Currency (the "OCC"),  the Board of Governors of the Federal Reserve
     System (the "Federal Reserve"),  the Federal Deposit Insurance  Corporation
     (the "FDIC"), the Internal Revenue Service and state taxing authorities and
     the  Securities  and  Exchange   Commission  (the  "SEC").  The  effect  of
     applicable   statutes,   regulations   and   regulatory   policies  can  be
     significant, and cannot be predicted with a high degree of certainty.

     Federal and state laws and  regulations  generally  applicable to financial
     institutions,  such as the Company and its  subsidiaries,  regulate,  among
     other  things,  the  scope  of  business,  investments,   reserves  against
     deposits,  capital levels relative to operations,  the nature and amount of
     collateral   for   loans,   the   establishment   of   branches,   mergers,
     consolidations  and  dividends.  The system of  supervision  and regulation
     applicable to the Company and its subsidiaries  establishes a comprehensive
     framework for their respective operations and is intended primarily for the
     protection of the FDIC's deposit insurance funds and the depositors, rather
     than the shareholders, of financial institutions.
<PAGE>

     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 to the Company and its  subsidiaries,  nor does it restate all of the
     requirements of the statutes,  regulations and regulatory policies that are
     described. As such, the following is qualified in its entirety by reference
     to the applicable statutes, regulations and regulatory policies. Any change
     in applicable law,  regulations or regulatory  policies may have a material
     effect on the business of the Company and its subsidiaries.

     Recent Regulatory Developments

     The  terrorist  attacks in  September,  2001,  have  impacted the financial
     services industry and have already led to federal legislation that attempts
     to address  certain related issues  involving  financial  institutions.  On
     October  26,  2001,   President  Bush  signed  into  law  the  Uniting  and
     Strengthening  America by Providing Appropriate Tools Required to Intercept
     and Obstruct Terrorism Act of 2001 (the "USA PATRIOT Act"). Among its other
     provisions, the USA PATRIOT Act requires each financial institution: (i) to
     establish an anti-money laundering program; (ii) to establish due diligence
     policies,  procedures  and  controls  with  respect to its private  banking
     accounts and correspondent  banking accounts involving foreign  individuals
     and certain foreign banks;  and (iii) to avoid  establishing,  maintaining,
     administering, or managing correspondent accounts in the United States for,
     or on behalf of, foreign banks that do not have a physical  presence in any
     country. The USA PATRIOT Act also requires the Secretary of the Treasury to
     prescribe,  by regulations  to be issued  jointly with the federal  banking
     regulators  and certain other  agencies,  minimum  standards that financial
     institutions must follow to verify the identity of customers,  both foreign
     and  domestic,  when a customer  opens an  account.  In  addition,  the USA
     PATRIOT Act contains a provision  encouraging  cooperation  among financial
     institutions,  regulatory authorities and law enforcement  authorities with
     respect  to  individuals,   entities  and  organizations   engaged  in,  or
     reasonably  suspected of engaging in,  terrorist  acts or money  laundering
     activities.  At this time,  the Company is unable to determine  whether the
     provisions  of the USA  PATRIOT  Act will  have a  material  impact  on the
     business of the Company and its subsidiaries.

     The Company

     General. The Company, as the sole shareholder of the Bank Subsidiaries,  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, 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  Subsidiaries  and to commit  resources  to
     support the Bank Subsidiaries 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.  The Company is also subject to regulation
     by the  Commissioner  under the  Illinois  Bank  Holding  Company  Act,  as
     amended.

     Investments  and  Activities.  Under the BHCA, a bank holding  company must
     obtain  Federal  Reserve  approval  before:  (i)  acquiring,   directly  or
     indirectly,  ownership  or control of any voting  shares of another bank or
     bank  holding  company if, after the  acquisition,  it would own or control
     more  than 5% of the  shares  of the  other  bank or bank  holding  company
     (unless it already  owns or controls  the  majority of such  shares);  (ii)
     acquiring all or substantially  all of the assets of another bank; or (iii)
     merging or  consolidating  with another bank  holding  company.  Subject to
     certain  conditions   (including  certain  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  without
     regard to whether the  acquisition is prohibited by the law of the state in
     which the target bank is located.  In  approving  interstate  acquisitions,
     however, 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 which 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.
<PAGE>

     The BHCA also  generally  prohibits  the Company from  acquiring  direct or
     indirect  ownership or control of more than 5% of the voting  shares of any
     company  which 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."  Under current  regulations of the Federal
     Reserve,  this authority would permit the Company to engage in a variety of
     banking-related businesses,  including the operation of a thrift, sales and
     consumer finance,  equipment  leasing,  the operation of a computer service
     bureau  (including   software   development),   and  mortgage  banking  and
     brokerage.   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  activities 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 BHCA generally does not
     place  territorial  restrictions  on the  domestic  activities  of non-bank
     subsidiaries of bank holding companies or financial holding companies.  The
     Company has received approval to operate as a financial holding company.

     Federal law also prohibits any person or company from  acquiring  "control"
     of a bank or bank holding  company  without prior notice to the appropriate
     federal  bank  regulator.  "Control"  is defined  in  certain  cases as the
     acquisition  of 10% or more  of the  outstanding  shares  of a bank or bank
     holding company.

     Capital  Requirements.  Bank  holding  companies  are  required to maintain
     minimum  levels of capital  in  accordance  with  Federal  Reserve  capital
     adequacy  guidelines.  If capital falls below minimum  guideline  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  risk-weighted
     assets; 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  shareholders'  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  which 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, 2001,  the Company had  regulatory  capital in excess of
     the Federal Reserve's minimum requirements.
<PAGE>

     Dividends. The Illinois Business Corporation Act, as amended, prohibits 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, the Federal Reserve has issued a policy statement with regard
     to the payment of cash  dividends  by bank  holding  companies.  The policy
     statement  provides  that  a bank  holding  company  should  not  pay  cash
     dividends  which  exceed its net income or which 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.

     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 Banks

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

     First National Bank of Decatur ("Decatur") is a national bank, chartered by
     the OCC under the National  Bank Act.  The deposit  accounts of Decatur are
     insured by the BIF, and Decatur is a member of the Federal  Reserve System.
     As a  BIF-insured  national  bank,  Decatur is subject to the  examination,
     supervision,  reporting  and  enforcement  requirements  of the OCC, as the
     chartering  authority for national banks, and the FDIC, as administrator of
     the BIF. Decatur is also a member of the Federal Home Loan Bank System.

     Deposit Insurance. As FDIC-insured institutions,  the Bank Subsidiaries are
     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, 2001, BIF assessments  ranged from 0% of
     deposits  to 0.27%  of  deposits.  For the  semi-annual  assessment  period
     beginning January 1, 2002, BIF assessment rates will continue to range from
     0% of deposits to 0.27% of deposits.

     The FDIC may  terminate  the deposit  insurance  of any insured  depository
     institution if the FDIC determines,  after a hearing,  that the institution
     (i) has engaged or is engaging in unsafe or unsound  practices;  (ii) is in
     an  unsafe  or  unsound  condition  to  continue  operations;  or (iii) has
     violated any applicable law, regulation, order, or any condition imposed in
     writing by, or written  agreement with, the FDIC. The FDIC may also suspend
     deposit  insurance  temporarily  during the hearing process for a permanent
     termination  of  insurance  if the  institution  has no  tangible  capital.
     Management  of the Company is not aware of any activity or  condition  that
     could  result  in  termination  of  the  deposit   insurance  of  the  Bank
     Subsidiaries.
<PAGE>

     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.  During the year ended December 31,
     2001, the FICO assessment  rate for BIF and SAIF members was  approximately
     0.02% of deposits.

     Supervisory Assessments. All Illinois banks and national banks are required
     to pay supervisory  assessments to the Illinois  Commissioner  and the OCC,
     respectively,  to fund the  operations of such  agencies.  In general,  the
     amount of such  supervisory  assessments  is based upon each  institution's
     total  assets.   During  the  year  ended   December  31,  2001,  the  Bank
     Subsidiaries paid supervisory assessments totaling $215,000.

     Capital  Requirements.  The FDIC and the OCC have established the following
     minimum capital standards for state-chartered  insured non-member banks and
     national banks, such as the Bank Subsidiaries:  (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%. For
     purposes  of these  capital  standards,  Tier 1 capital  and total  capital
     consist of  substantially  the same  components as Tier 1 capital and total
     capital under the Federal  Reserve's  capital  guidelines  for bank holding
     companies (see "--The Company--Capital Requirements").

     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, the
     regulations of the FDIC and the OCC 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  to
     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 which 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 OCC and 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.

     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 the 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.
<PAGE>

     As of December 31, 2001: (i) none of the Bank Subsidiaries was subject to a
     directive  from the FDIC or the OCC to increase its capital to an amount in
     excess of the minimum  regulatory  capital  requirements;  (ii) each of the
     Bank  Subsidiaries  exceeded its minimum  regulatory  capital  requirements
     under applicable  capital adequacy  guidelines;  and (iii) each of the Bank
     Subsidiaries are "well-capitalized", as defined by applicable regulations.

     Additionally,  institutions  insured by the FDIC may be liable for any loss
     incurred  by,  or  reasonably  expected  to be  incurred  by,  the  FDIC in
     connection with the default of commonly  controlled FDIC insured depository
     institutions or any assistance  provided by the FDIC to commonly controlled
     FDIC  insured  depository  institutions  in danger of default.  Because the
     Company  owns  more than 25% of the  outstanding  stock of each of the Bank
     Subsidiaries, the Bank Subsidiaries are deemed to be commonly controlled.

     Dividends. Under the Illinois Banking Act, BankIllinois and Shelbyville may
     not pay dividends in excess of their net profits.

     The National Bank Act imposes  limitations  on the amount of dividends that
     may be paid by a national bank, such as Decatur. Generally, a national bank
     may pay dividends out of its undivided profits, in such amounts and at such
     times as the bank's board of directors  deems  prudent.  Without  prior OCC
     approval,  however,  a national  bank may not pay dividends in any calendar
     year which,  in the aggregate,  exceed the bank's  year-to-date  net income
     plus the bank's retained net income for the two preceding years.

     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, each of the Bank Subsidiaries exceeded its minimum capital
     requirements  under  applicable  guidelines  as of December 31, 2001. As of
     December 31, 2001,  approximately  $56,481,000  was available to be paid as
     dividends  to the  Company by the Bank  Subsidiaries.  Notwithstanding  the
     availability of funds for dividends,  however,  the banking  regulators may
     prohibit  the payment of any  dividends  by the Bank  Subsidiaries  if such
     payment is deemed to constitute an unsafe or unsound practice.

     Insider  Transactions.   The  Bank  Subsidiaries  are  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.
     Certain   limitations  and  reporting   requirements  are  also  placed  on
     extensions  of  credit  by the Bank  Subsidiaries  to their  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  becoming 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 Subsidiaries maintain a correspondent relationship.

     Safety and Soundness  Standards.  The federal banking agencies have adopted
     guidelines which 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.
<PAGE>

     Branching Authority.  Illinois banks, such as BankIllinois and Shelbyville,
     have the authority under Illinois law to establish branches anywhere in the
     State of Illinois, subject to receipt of all required regulatory approvals.
     National banks  headquartered in Illinois,  such as Decatur,  have the same
     branching rights in Illinois as banks chartered under Illinois law.

     Under the Riegle-Neal  Interstate  Banking and Branching  Efficiency Act of
     1994 (the "Riegle-Neal  Act"), both state and national banks are allowed to
     establish  interstate branch networks through  acquisitions of other banks,
     subject  to  certain  conditions,  including  certain  limitations  on  the
     aggregate amount of deposits that may be held by the surviving bank and all
     of its insured depository institution affiliates.  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 allowed by the Riegle-Neal Act only if specifically authorized
     by state law. The  legislation  allowed  individual  states to "opt-out" of
     certain   provisions  of  the  Riegle-Neal  Act  by  enacting   appropriate
     legislation  prior to June 1, 1997.  Illinois permits  interstate  mergers,
     subject to certain  conditions,  including a prohibition against interstate
     mergers  involving  an  Illinois  bank  that  has  been  in  existence  and
     continuous operation for fewer than five years.

     State Bank Activities. 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 or its subsidiary,  respectively,  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 BankIllinois or Shelbyville.

     Financial  Subsidiaries.  Under Federal law and OCC  regulations,  national
     banks are authorized to engage,  through "financial  subsidiaries",  in any
     activity that is permissible for a financial  holding company (as described
     above) and any activity that the Secretary of the Treasury, in consultation
     with the Federal  Reserve,  determines is financial in nature or incidental
     to any such financial  activity,  except (i) insurance  underwriting,  (ii)
     real  estate  development  or real  estate  investment  activities  (unless
     otherwise permitted by law), (iii) insurance company portfolio  investments
     and (iv) merchant banking.  The authority of a national bank to invest in a
     financial subsidiary is subject to a number of conditions, including, among
     other  things,   requirements  that  the  bank  must  be  well-managed  and
     well-capitalized  (after  deducting  from  capital  the bank's  outstanding
     investments  in financial  subsidiaries).  Federal law also  provides  that
     state banks may invest in financial  subsidiaries  (assuming  they have the
     requisite  investment  authority  under  applicable  state law)  subject to
     substantially  the same conditions that apply to national bank  investments
     in financial subsidiaries. None of the Bank Subsidiaries has applied for or
     received approval to establish any financial subsidiaries.

     Federal  Reserve  System.  Federal  Reserve  regulations,  as  presently in
     effect,  require depository  institutions to maintain  non-interest earning
     reserves  against their  transaction  accounts  (primarily  NOW and regular
     checking accounts),  as follows: for transaction accounts aggregating $41.3
     million  or  less,  the  reserve  requirement  is 3% of  total  transaction
     accounts;  and for  transaction  accounts  aggregating  in  excess of $41.3
     million,  the  reserve  requirement  is  $1.239  million  plus  10%  of the
     aggregate amount of total transaction  accounts in excess of $41.3 million.
     The first $5.7 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 Subsidiaries are in compliance
     with the foregoing requirements.

F.   Employees

     The Company had a total of 464  employees at December 31, 2001,  consisting
     of 370  full-time  employees and 94  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 customer 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 excellent.
<PAGE>

Item 2.  Properties

The Company and its subsidiaries  conduct business in seventeen  locations.  The
Company and BankIllinois'  headquarters are located at 100 W. University Ave. in
Champaign,  Illinois.  The  Company  and/or  its  subsidiaries  own the land and
buildings  for  eleven  locations  and lease six  locations,  three of which are
located in supermarkets.

All of the Banks own their main banking  facilities.  The Company  believes that
its facilities are adequate to serve its present needs.

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 2001.


                                     PART II

Item 5.  Market For Registrant's Common Equity And Related Shareholder Matters

The Company's Common Stock was held by approximately  750 shareholders of record
as of March 25, 2002, and is traded in the over-the-counter market.

The following table shows,  for the periods  indicated,  the range of 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,  and have not been  adjusted to reflect the 5% stock  dividends
paid by the Company in the third quarters of 2000 and 2001.

                                                              Cash
                                  High          Low         Dividends
---------------------------------------------------------------------

2000     First quarter           $20.95        $20.95        $ 0.08
         Second quarter           20.95         19.04          0.10
         Third quarter            19.28         16.87          0.10
         Fourth quarter           17.62         16.50          0.10

2001     First quarter           $18.88        $16.63        $ 0.10
         Second quarter           19.25         18.33          0.11
         Third quarter            19.25         17.50          0.11
         Fourth quarter           18.70         17.55          0.11

During the fourth quarter of 2001,  the Company  declared a $0.13 per share cash
dividend,  which was paid on January 25, 2002. The ability of the Company to pay
dividends  in the  future  will be  primarily  dependent  upon  its  receipt  of
dividends from the Banks. 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 Banks' 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.
<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,  2001.  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. All references to numbers of shares and per share amounts have
been retroactively restated to reflect the 5% stock dividend in 2001.
<TABLE>
                                                                          Year Ended December 31,
                                                      ------------------------------------------------------------------
                                                        2001          2000          1999          1998            1997
------------------------------------------------------------------------------------------------------------------------
<S>                                                   <C>           <C>           <C>           <C>           <C>
                                                                 (dollars in thousands, except per share data)
Interest income ...................................   $   73,195    $   74,271    $   67,070    $   65,710    $   63,705
Interest expense ..................................       33,598        36,599        31,713        31,862        31,127
                                                      ------------------------------------------------------------------
        Net interest income .......................       39,597        37,672        35,357        33,848        32,578
Provision for loan losses .........................        2,670           804           573           809           897
                                                      ------------------------------------------------------------------
Net interest income after provision for loan losses       36,927        36,868        34,784        33,039        31,681
Non-interest income ...............................       17,101        16,236        17,858        14,554        12,799
Non-interest expense ..............................       30,121        34,689        35,789        30,591        29,011
Income tax expense ................................        7,736         6,426         5,165         5,318         4,977
                                                      ------------------------------------------------------------------
     Net income ...................................   $   16,171    $   11,989    $   11,688    $   11,684    $   10,492
                                                      ------------------------------------------------------------------
Basic earnings per share ..........................   $     1.48    $     1.08    $     1.05    $     1.02    $     0.92
                                                      ------------------------------------------------------------------
Diluted earnings per share ........................   $     1.45    $     1.06    $     1.03    $     1.00    $     0.90
                                                      ------------------------------------------------------------------
Return on average total assets ....................        1.47%         1.15%         1.16%         1.23%         1.17%

Return on average shareholders' equity ............       12.32%        10.03%        10.10%        10.29%        10.04%
Cash dividends declared per common share1 .........   $     0.45    $     0.40    $     0.29    $     0.28    $     0.15
                                                      ------------------------------------------------------------------
Total assets ......................................   $1,151,511    $1,091,081    $1,035,746    $  979,019    $  931,539
Investment in debt and equity securities ..........      335,422       303,187       300,040       354,346       293,711
Loans held for investment, net ....................      673,061       659,849       601,594       502,118       506,251
Deposits ..........................................      884,109       839,932       795,075       765,666       729,853
Borrowings ........................................      120,102       110,636       111,198        88,145        72,410
Total shareholders' equity ........................      135,993       125,402       116,081       112,586       103,059

Total shareholders' equity to total assets ........       11.81%        11.49%        11.21%        11.73%        11.06%
Average shareholders' equity to average assets ....       11.91%        11.45%        11.46%        11.95%        11.64%
<FN>
1    Prior to the merger of BankIllinois Financial Corporation and First Decatur
     Bancshares in March 2000, both companies paid cash dividends each year.
</FN>
</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 2001, 2000
and 1999 for the Company,  including  all  subsidiaries,  and an analysis of the
Company's financial condition at December 31, 2001 compared to December 31, 2000
and at December  31, 2000  compared to December 31, 1999.  This  discussion  and
analysis  should  be  read  in  conjunction  with  the  consolidated   financial
statements and related notes, which begin at page 30 of this report.
<PAGE>

Overview

The years ended  December 31, 2001,  2000 and 1999 were years of transition  for
Main Street Trust, Inc. involving fundamental reorganization of the consolidated
organization.  During the first  quarter of 2000,  the  Company  was formed as a
result of the  "merger of equals" of two strong  financial  services  companies.
Despite being in this post-merger  transitional  period,  and facing a worsening
economic environment and sagging consumer confidence,  the Company posted record
results during 2001. Each of the last three years have non-recurring items which
have had significant  effects on the Company's  reported results,  many of which
were merger related.

Merger  and  related  non-recurring  restructuring  expenses  incurred  in  2001
consisted of $70,000 of data  processing  expense and $256,000 of termination of
employment  contracts,  offset by $111,000 of tax  benefit.  Also during 2001, a
$2,500,000  reconciliation  liability  expense,  net of tax of  $1,000,000,  was
reversed against  non-interest  expense.  The resulting effect of these items on
basic and diluted  earnings per share for 2001, was an increase of approximately
$0.12 and $0.11 respectively.  Costs incurred in 2000 associated with the merger
and related non-recurring  restructuring consisted of $2,544,000 of professional
fees, $1,036,000 of early retirement and termination of employment contracts and
$587,000 of expense related to computer equipment write-down, offset by $639,000
of tax  benefit.  The  resulting  effect  of these  costs on basic  and  diluted
earnings per share was a decrease of approximately $0.32 and $0.31 respectively,
for  2000.   Non-recurring   costs   incurred  in  1999  included  a  $2,500,000
reconciliation  liability  expense  and an  $815,000  pension  plan  termination
expense as well as other employee-related matters, net of tax of $1,127,000. The
resulting  effect of these  costs on basic and  diluted  earnings  per share for
1999, was a decrease of approximately $0.20 and $0.19 respectively.

Segment Operations

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

Results of Operations

The Company had record  earnings of  $16,171,000 in 2001 compared to $11,989,000
in 2000 and  $11,688,000  in 1999. The Company had a return on average assets of
1.47%, 1.15% and 1.16% in 2001, 2000 and 1999, respectively. The rates of return
in 2001,  2000 and 1999 were  significantly  affected  by  non-recurring  events
discussed  above.  Basic earnings per share was $1.48,  $1.08 and $1.05 in 2001,
2000 and 1999,  respectively.  Diluted  earnings per share was $1.45,  $1.06 and
$1.03 in 2001,  2000 and 1999  respectively.  Management  believes that a strong
balance sheet and excellent profitability are critical to success,  particularly
when the economy experiences a slowdown.

Net Interest Income

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 34%. The  adjustment to net
interest  income  for the tax  effect  of  tax-exempt  assets  is  shown  in the
following  schedule.  Net tax equivalent  (TE) interest income of $40,866,000 in
2001 reflected an increase from the $38,770,000  recorded in 2000,  which was an
increase from the $36,417,000 recorded in 1999.

                  Net Interest Income on a Tax Equivalent Basis
                                 (in thousands)

                                                2001         2000         1999
                                               ---------------------------------

Total interest income ...................      $73,195      $74,271      $67,070
Total interest expense ..................       33,598       36,599       31,713
                                               ---------------------------------
     Net interest income ................       39,597       37,672       35,357
Tax equivalent adjustment:
     Tax-exempt investments .............        1,210        1,046        1,004
     Tax-exempt loans ...................           59           52           56
                                               ---------------------------------
          Total adjustment ..............        1,269        1,098        1,060
                                               ---------------------------------
Net interest income (TE) ................      $40,866      $38,770      $36,417
                                               =================================
<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.

              Consolidated Average Balance Sheet and Interest Rates
                             (dollars in thousands)
<TABLE>
                                                      2001                           2000                          1999
                                        --------------------------------------------------------------------------------------------
                                         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 securities1 .......  $  250,890   $ 13,831   5.51%   $  259,980  $ 15,533   5.97%   $  289,879  $ 16,855    5.81%
Tax-exempt investment securities1 (TE)      52,836      3,557   6.73%       44,630     3,077   6.89%       42,564     2,952    6.94%
Federal funds sold and interest
  bearing deposits2 ..................      39,526      1,737   4.39%       22,688     1,553   6.85%       23,994     1,226    5.11%
Loans3,4 (TE) ........................     669,702     55,339   8.26%      623,652    55,206   8.85%      549,098    47,097    8.58%
                                        --------------------------------------------------------------------------------------------
     Total interest earning assets
          and interest income (TE) ...  $1,012,954   $ 74,464   7.35%  $  950,950   $ 75,369   7.93%   $  905,535  $ 68,130    7.52%
                                        --------------------------------------------------------------------------------------------
Cash and due from banks ..............  $   49,282                     $   48,809                      $   62,236
Premises and equipment ...............      20,336                         21,641                          21,318
Other assets .........................      20,013                         22,034                          21,423
                                        --------------------------------------------------------------------------------------------
     Total assets ....................  $1,102,585                     $1,043,434                      $1,010,512
                                        ============================================================================================
Liabilities and Shareholders' Equity
Interest bearing demand deposits .....  $  107,992   $  2,229   2.06%  $   81,416   $  2,112   2.59%   $   93,885   $  2,181   2.32%
Savings ..............................     229,493      6,743   2.94%     235,935      9,021   3.82%      230,298      7,652   3.32%
Time deposits ........................     360,590     19,859   5.51%     344,305     19,531   5.67%      324,059     17,084   5.27%
Federal funds purchased, repurchase
  agreements and notes payable .......      74,918      2,550   3.40%      75,376      3,764   4.99%       74,663      3,110   4.17%
FHLB advances and other borrowings ...      38,980      2,217   5.69%      36,718      2,171   5.91%       29,376      1,686   5.74%
                                        --------------------------------------------------------------------------------------------
     Total interest bearing liabilities
          and interest expense .......  $  811,973   $ 33,598   4.14%  $  773,750   $ 36,599   4.73%   $  752,281   $ 31,713   4.22%
                                        --------------------------------------------------------------------------------------------
Non-interest bearing demand deposits5   $  102,136                     $   88,059                      $   97,856
Non-interest bearing savings deposits5      42,810                         47,906                          33,896
Other liabilities ....................      14,375                         14,210                          10,714
                                        --------------------------------------------------------------------------------------------
     Total liabilities ...............  $  971,294                     $  923,925                      $  894,747
Shareholders' equity .................     131,291                        119,509                         115,765
                                        --------------------------------------------------------------------------------------------
     Total liabilities and
          shareholders' equity .......  $1,102,585                     $1,043,434                      $1,010,512
                                        ============================================================================================
Interest spread (average rate earned
     minus average rate paid) (TE) ...                          3.21%                          3.20%                           3.30%
                                        ============================================================================================
Net interest income (TE) .............               $ 40,866                       $ 38,770                        $ 36,417
                                        ============================================================================================
Net yield on interest
     earning assets (TE) .............                          4.03%                          4.08%                           4.02%
                                        ============================================================================================
<FN>
Notes:  see next page for notes 1-5

Notes to Consolidated Average Balance Sheet and Interest Rates Table:
1    Investments in debt securities are included at carrying value.
2    Federal  funds sold and interest  earning  deposits  include  approximately
     $114,000,  $154,000 and $138,000 in 2001, 2000 and 1999,  respectively,  of
     interest income from third party processing of cashier checks.
3    Loans are net of allowance for loan losses and include  mortgage loans held
     for sale. Nonaccrual loans are included in the total.
4    Loan fees of approximately $1,058,000,  $1,061,000, and $1,212,000 in 2001,
     2000 and 1999, respectively, are included in total loan income.
5    Current  regulations  permit  the  Company  to  reclassify  certain  demand
     deposits to savings deposits. Accounts identified as transactional remained
     in the demand categories,  while accounts  identified as  non-transactional
     were reclassified into the savings categories. The classification was based
     upon whether the account  balance was  fluctuating  or whether it exhibited
     stable balance  portions,  which were called  non-transactional.  Banks are
     required  to  hold  balances  at  the  Federal   Reserve  Bank  based  upon
     transactional   account   balances.   By  identifying   these  accounts  as
     non-transactional,  the Company was able to reduce the balances required to
     be held at the  Federal  Reserve  Bank in a  non-interest  bearing  reserve
     account.
</FN>
</TABLE>
<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.

                       Analysis of Volume and Rate Changes
                                 (in thousands)
<TABLE>
                                                      2001                           2000
                                       --------------------------------------------------------------
                                        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 .....   ($1,702)   ($  530)   ($1,172)   ($1,322)   ($1,777)   $   455
  Tax-exempt investment securities ..       480        554        (74)       125        142        (17)
  Federal funds sold and interest
    bearing deposits ................       184        874       (690)       327        (71)       398
  Loans .............................       133      3,933     (3,800)     8,109      6,560      1,549
                                        --------------------------------------------------------------
          Total interest income .....   ($  905)   $ 4,831    ($5,736)   $ 7,239    $ 4,854    $ 2,385
                                        --------------------------------------------------------------

Interest Expense
  Interest bearing demand
    and savings deposits ............   ($2,161)   $   671    ($2,832)   $ 1,300   ($   212)   $ 1,512
  Time deposits .....................       328        907       (579)     2,447      1,105      1,342
  Federal funds purchased, repurchase
    agreements and notes payable ....    (1,214)       (23)    (1,191)       654         30        624
  Federal Home Loan Bank advances
    and other borrowings ............        46        131        (85)       485        433         52
                                        --------------------------------------------------------------
          Total interest expense ....   ($3,001)   $ 1,686    ($4,687)   $ 4,886    $ 1,356    $ 3,530
                                        --------------------------------------------------------------

Net Interest Income (TE) ............   $ 2,096    $ 3,145    ($1,049)   $ 2,353    $ 3,498    ($1,145)
                                        ==============================================================
</TABLE>

Total  average   earning  assets   increased  from   $950,950,000   in  2000  to
$1,012,954,000  in 2001, but generated  lower levels of interest income due to a
significant  decrease in interest  rates during 2001.  Average  loans  increased
$46,050,000,  resulting in an increase of $133,000 in interest income,  of which
$3,933,000  was due to an  increase  in volume,  mostly  offset by a  $3,800,000
decrease  attributable  to lower rates.  Average federal funds sold and interest
bearing  deposits  increased  $16,838,000  in 2001,  resulting in an increase in
interest income in this category of $184,000. Of this increase, $874,000 was due
to an increase in volume,  offset  substantially by $690,000 due to lower rates.
Average tax-exempt investment  securities increased $8,206,000,  resulting in an
increase  of  $480,000  in  interest  income,  of which  $554,000  was due to an
increase  in volume,  offset  slightly  by  $74,000  due to lower  rates.  These
increases  in average  balances  were  offset by a decrease  in average  taxable
investment  securities of  $9,090,000,  resulting in a decrease of $1,702,000 in
interest income in this category,  of which $530,000 was due to lower volume and
$1,172,000 was due to a decrease in rates.

Total average earning assets increased from $905,535,000 in 1999 to $950,950,000
in 2000,  generating  higher  levels of interest  income in 2000,  and  interest
expense increased due to a trend toward higher rates during 2000.  Average loans
increased  $74,554,000,  resulting  in an  increase  of  $8,109,000  in interest
income,  of which $6,560,000 was due to an increase in volume and $1,549,000 was
attributable to higher rates. Average tax-exempt investment securities increased
$2,066,000,  resulting in an increase of $125,000 in interest  income,  of which
$142,000  was due to an  increase in volume,  offset  slightly by $17,000 due to
lower rates.  These  increases in average  balances  were  somewhat  offset by a
decrease in average taxable investment securities of $29,899,000, resulting in a
decrease of $1,322,000 in interest income in this category,  of which $1,777,000
was due to lower  volume,  somewhat  offset by  $455,000  due to an  increase in
rates.  Also, average federal funds sold and interest bearing deposits decreased
$1,306,000  in  2000.  However,  interest  income  in  this  category  increased
$327,000.  Of this  increase,  $398,000 was due to an increase in rates,  offset
somewhat by $71,000 due to lower volume.
<PAGE>

The Company  establishes  interest  rates on loans and deposits  based on market
rates--such as the 91-day  Treasury Bill rate and the prime  rate--and  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  lower in 2001 compared to 2000.  The average rate
earned on loans  decreased  59 basis points from 8.85% in 2000 to 8.26% in 2001.
The yield on  tax-exempt  investment  securities  decreased 16 basis points from
6.89% in 2000 to  6.73% in 2001.  The  yield on  taxable  investment  securities
decreased  46 basis  points from 5.97% for the year ended  December  31, 2000 to
5.51% for the year ended  December 31, 2001. The yield on federal funds sold and
interest bearing deposits decreased 246 basis points from 6.85% in 2000 to 4.39%
in 2001.

The total  actual  balance of loans at  December  31,  2001 was  higher  than at
December  31, 2000.  Commercial,  financial  and  agricultural  loans  increased
$26,501,000 from 2000 to 2001.  Somewhat offsetting this increase were decreases
of $10,190,000 and $2,719,000 in consumer and installment loans, and real estate
loans,  respectively.  Lower market rates contributed to the overall increase in
the demand for loans from 2000 to 2001.

Average rates on total interest bearing  liabilities  decreased 59 basis points,
from 4.73% in 2000 to 4.14% in 2001, resulting in a decrease in interest expense
of  $3,001,000 in 2001  compared to 2000,  due to the falling rate  environment.
This was mainly  caused by a decrease  in interest  expense on interest  bearing
demand and savings  deposits of $2,161,000 in 2001, of which  $2,832,000 was due
to a decrease in rates, offset somewhat by $671,000 due to increased volume. The
average rates paid on federal funds purchased,  repurchase  agreements and notes
payable  decreased  159 basis  points from 4.99% in 2000 to 3.40% in 2001.  This
resulted in a decrease in interest  expense of $1,214,000,  of which  $1,191,000
was due to rate decreases and $23,000 was due to lower volume.  These  decreases
were offset  somewhat  by an  increase  of $328,000 in interest  expense on time
deposits.  Of this increase,  $907,000 was due to an increase in volume,  offset
somewhat by $579,000 due to lower rates.  Interest  expense on Federal Home Loan
Bank advances and other borrowings increased $46,000, with $131,000 attributable
to volume increases, offset somewhat by $85,000 due to lower rates.

Interest expense increased  $4,886,000 in 2000 compared to 1999. This was mainly
caused by an  increase of  $2,447,000  of  interest  on time  deposits.  Of this
increase,  $1,342,000  was due to an increase in rate,  as the average rate paid
increased  from  5.27% in 1999 to 5.67% in 2000,  and  $1,105,000  was due to an
increase  in volume.  Interest  expense on interest  bearing  demand and savings
deposits  increased  $1,300,000  in  2000,  of  which  $1,512,000  was due to an
increase in rates,  as average rates paid  increased from 3.03% in 1999 to 3.51%
in 2000. This increase was slightly  offset by a $212,000  decrease due to lower
volume.  The average balance of federal funds purchased,  repurchase  agreements
and notes payable  increased  from  $74,663,000  in 1999 to $75,376,000 in 2000.
This resulted in an increase in interest expense of $654,000,  of which $624,000
was due to rate increases and $30,000 was due to higher volume. Interest expense
on Federal Home Loan Bank advances and other borrowings increased $485,000, with
$433,000 attributable to volume increases and $52,000 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 loans and all loans
which present indications of additional credit risk.

Continued emphasis on loan quality was reflected in the ratio of net charge-offs
to average net loans of 0.34% in 2001,  though there was an increase  from 0.10%
in 2000. Net charge-offs  increased to $2,290,000 in 2001 from $607,000 in 2000,
though net charge-offs for 2000 included a $300,000  recovery  associated with a
commercial  credit.  The Company  charged off  $2,673,000  in loans  during 2001
compared  to  $1,252,000  in  2000.  Increases  in  charge-offs  of  commercial,
financial and  agricultural  loans of $1,066,000  and  installment  and consumer
loans of $362,000  accounted for most of the change.  The increased  charge-offs
were due largely to charge-offs on two agriculture credits totaling $847,000 and
increased  charge-offs  in the retail  lending  area,  particularly  in indirect
vehicle  loans.  Recoveries  of  previously  charged  off loans  decreased  from
$645,000 in 2000 to $383,000 in 2001,  with the largest  decrease in the area of
commercial,  financial and agricultural loans which decreased $284,000 from 2000
to 2001. The provision for loan losses  increased  $1,866,000,  from $804,000 in
2000 to $2,670,000  in 2001.  This increase was necessary to bring the allowance
for loan losses as a percentage of total loans,  including  loans held for sale,
to  1.34%,  in line  with the 2000  year end  level  of  1.32%,  and to  provide
additional  reserves  because  of the  softening  economy.  (See the  section on
Allowance for Loan Losses and Loan Quality  elsewhere in this report for further
discussion  relating to the  adequacy of the  allowance  for loan  losses.)  The
Company  continues to emphasize  credit  analysis and early detection of problem
loans.
<PAGE>

Along with other  financial  institutions,  management  shares a concern for the
outlook of the economy in 2002.  In addition to the  softening of the economy in
2001, the tragic events of September 11, 2001 have further  clouded the economic
outlook,  severely impacting several major industries, as well as the economy as
a whole.  Additionally,  consumer  confidence,  a key factor in the economy, was
negatively  impacted.  Although the economy shows signs of  improving,  the past
economic  slowdown could still adversely  affect cash flows from both commercial
and individual  borrowers,  as a result of which,  the Company could  experience
increases in problem assets, delinquencies and losses on loans.

Non-interest Income

Non-interest income increased $865,000,  or 5.3%, from 2000 to 2001. Included in
this  increase  was an increase of $616,000,  or 290.6%,  from gains on sales of
mortgage loans  held-for-sale.  This increase  resulted from a  $78,618,000,  or
307.9%,  increase in mortgage loans sold during 2001 compared to 2000 due to the
falling  interest  rate  environment.  Remittance  processing  income  increased
$582,000,  or 8.8%,  during 2001  compared  to 2000.  This  increase  was due to
increased volume coupled with restructured  pricing for some customers.  Service
charges on deposit  accounts  increased  $130,000,  or 6.2%, in 2001 compared to
2000. Also  contributing to the increase in non-interest  income was an $89,000,
or 423.8%, increase in income from securities transactions.  This was the result
of the sale of some  securities to reposition the portfolio in the changing rate
environment.  Somewhat  offsetting  these  increases  was a  decrease  in  other
non-interest income of $305,000, or 16.6%, from $1,837,000 in 2000 to $1,532,000
in 2001.  Proceeds from a life insurance policy of  approximately  $81,000 along
with $22,000 in one-time fee income during 2000,  contributed  to this decrease.
Also,  income from trust and brokerage fees decreased  $247,000,  or 4.5%,  from
$5,474,000 in 2000 to $5,227,000 in 2001. This was due, in part, to the downturn
in the stock market during late 2000 and 2001. Market values have been depressed
causing fee income, which is based on market valuation, to decline in this area.

Non-interest  income  decreased  $1,622,000,  or 9.1%,  from 1999 to 2000.  This
decrease  was  primarily  due to a decrease  at  FirsTech,  Inc.  in  remittance
processing  income  of  $1,546,000,  or  19.0%.  Although  the  number  of items
processed was comparable  between 2000 and 1999,  there was a shift from lockbox
payments to mechanized payments which have both lower revenue streams as well as
lower costs. Gain on sales of mortgage loans  held-for-sale  decreased $315,000,
or 59.8%. This decrease reflected a $34,349,000,  or 57.4%, decrease in mortgage
loans sold  during  2000  compared  to 1999 due to the  changing  interest  rate
environment.  Also  contributing  to the decrease in  non-interest  income was a
$298,000,  or  14.0%,  decrease  in  other  income  from  $2,135,000  in 1999 to
$1,837,000  in 2000.  This  decrease was due, in part, to $159,000 in consulting
revenue in 1999,  which did not occur in 2000,  as well as a decrease of $96,000
in  mortgage  servicing  income.   Further   contributing  to  the  decrease  in
non-interest  income was a decrease in income from  securities  transactions  of
$120,000,  or 85.1%.  This was mainly the result of selling an equity investment
in 1999 for a gain of  $100,000  with no  comparable  sales  in  2000.  Somewhat
offsetting  these decreases was an increase of $576,000,  or 11.8%, in trust and
brokerage  fees.  The  majority of this  increase was due to the addition of new
business.  Higher  market  values  during the first three  quarters of 2000 also
added to the  increase  in assets  under  management  on which  fees are  based.
Service charges on deposit accounts increased $81,000, or 4.0%.

Non-interest Expense

Total  non-interest  expense decreased  $4,568,000,  or 13.2%, to $30,121,000 in
2001 from $34,689,000 in 2000. The 2000 expense was a decrease of $1,100,000, or
3.1%, compared to 1999 non-interest expense of $35,789,000.  During 2001, merger
related professional fees were none compared to $2,544,000 in 2000. During 1999,
the  Company  investigated  reconciliation   differences,   which  involved  the
Company's  subsidiary,   FirsTech,   Inc.  in  connection  with  its  commercial
remittance  processing  services.   After  consultation  with  its  professional
advisors,  the  Company's  Board of Directors  directed  that a liability in the
amount of $2.5 million be recorded in the fourth quarter of 1999.  Investigation
of these  differences  was completed  during the fourth  quarter of 2001. It was
determined that no liability existed and the $2.5 million liability was reversed
in  non-interest  expense  in 2001.  There  was no effect in year 2000 from this
reconciliation  difference.  During 2001, salaries and employee benefits expense
decreased $513,000,  or 2.8%, equipment expense decreased $247,000, or 6.8%, and
service charges from correspondent banks decreased $113,000,  or 11.3%. Somewhat
offsetting  these  decreases  were  increases in other  non-interest  expense of
$500,000,  or 11.6%,  data  processing  expense of  $473,000,  or 32.2%,  office
supplies  expense of $299,000,  or 24.2% and  occupancy  expense of $77,000,  or
3.5%. During 2000, salaries and employee benefits decreased  $501,000,  or 2.7%,
other expense decreased $476,000,  or 10.0%,  service charges from correspondent
banks decreased $430,000,  or 30.1%,  occupancy expense decreased  $187,000,  or
7.8% and office supplies expense decreased $19,000, or 1.5%. Somewhat offsetting
these  decreases  were  increases  in  merger  related   professional   fees  of
$2,544,000,  equipment expense of $279,000, or 8.3%, and data processing expense
of $190,000, or 14.8%.
<PAGE>

Salaries and employee benefits decreased $513,000,  or 2.8%, from $18,274,000 in
2000 to  $17,761,000  in 2001.  Salaries and employee  benefits in 2001 included
$256,000 of expenses related to the termination of employment contracts compared
to $1,034,000 in expenses in 2000 related to early retirement and termination of
employment  contracts as a result of the merger.  Salaries and employee benefits
in 2000 decreased $501,000, or 2.7%, from $18,775,000 in 1999. This decrease was
mainly due to closure of FirsTech, Inc.'s Hammond processing center in 1999.

Equipment  expense  decreased  $247,000,  or 6.8%,  from  $3,652,000  in 2000 to
$3,405,000  in 2001.  This was  primarily  due to  $587,000  in  merger  related
write-downs  of computer  equipment  and  software in 2000.  In 2000,  equipment
expense increased  $279,000,  or 8.3%, from $3,373,000 in 1999. Included in this
increase was the aforementioned  merger related write-down of computer equipment
and software.

Services charges from  correspondent  banks decreased  $113,000,  or 11.3%, from
$998,000  in  2000  to  $885,000  in  2001.  In  2000,   services  charges  from
correspondent banks decreased $430,000, or 30.1%, from $1,428,000 in 1999. These
decreases  reflected a  continuing  shift from  lockbox  payments to  mechanized
payments, which have lower costs.

Other non-interest expense increased $500,000, or 11.6%, from $4,295,000 in 2000
to $4,795,000 in 2001. In 2000, other non-interest  expense decreased  $476,000,
or 10.0%,  from  $4,771,000  in 1999.  Included in these changes was $461,000 in
other  real  estate  income in 2000 from the sale of a  property  which had been
previously written down.

Data processing expense increased $473,000, or 32.2%, from $1,470,000 in 2000 to
$1,943,000 in 2001. Included in data processing expense were expenses associated
with  conversion to third party  service  bureau data  processing  from in-house
processing,  and $70,000 in expenses  related to computer system  conversion and
early contract  termination as a result of the computer  system  conversion.  In
2000, data processing expense increased  $190,000,  or 14.8%, from $1,280,000 in
1999. The increases in data processing expense over these periods was due to the
Company's  continuing  commitment to invest in technology as it positions itself
for the future.

Office supplies expense increased $299,000, or 24.2%, from $1,236,000 in 2000 to
$1,535,000 in 2001.  Included in office supplies expense in 2001 were additional
printing and mailing expenses and additional  supplies  purchased to support and
announce  a  computer  system   conversion   necessary  to  move  the  Company's
subsidiaries  toward the same data processing  system.  In 2000, office supplies
expense decreased $19,000, or 1.5%, from $1,255,000 in 1999.

Occupancy  expense  increased  $77,000,  or  3.5%,  from  $2,220,000  in 2000 to
$2,297,000 in 2001. In 2000, occupancy expense decreased $187,000, or 7.8%, from
$2,407,000  in 1999.  This  decrease  was  primarily  related to the  closure of
FirsTech, Inc.'s Hammond processing center.

Income Tax Expense

Income tax expense  increased  $1,310,000,  or 20.4%, from $6,426,000 in 2000 to
$7,736,000  in 2001.  This was due to an  increase  in taxable  income.  In 2000
income tax expense increased $1,261,000,  or 24.4%, from $5,165,000 in 1999, due
to an increase in taxable  income as well as merger  related  expenses for which
the Company has not recognized a tax benefit.  The Company's  effective tax rate
was 32.4%, 34.9% and 30.6% for the years ended December 31, 2001, 2000 and 1999,
respectively.  The effective  tax rate was higher in 2000 due to merger  related
expenses for which the Company has not recognized a tax benefit.

The tax  effects  of  temporary  differences,  which  gave  rise to  significant
portions of the deferred tax assets and deferred tax liabilities at December 31,
2001 and  2000,  are  shown in note 11 in the  Notes to  Consolidated  Financial
Statements.
<PAGE>

Financial Condition

Total assets increased  $60,430,000,  or 6%, from $1,091,081,000 at December 31,
2000 to  $1,151,511,000  at December  31,  2001.  The  increase in total  assets
resulted   from   an   increase   of   $52,810,000,   or  25%,   in   securities
available-for-sale,  an  increase of  $28,928,000,  or 49%, in cash and due from
banks,  an increase of $13,212,000,  or 2%, in loans,  net of allowance for loan
losses, an increase of $6,685,000, or 320%, in mortgage loans held-for-sale,  an
increase of  $579,000,  or 13%, in other equity  securities,  and an increase of
$412,000,  or 4%, in other assets.  These  increases  were somewhat  offset by a
decrease of $21,154,000,  or 25%, in investment securities  held-to-maturity,  a
decrease of  $17,688,000,  or 70%, in federal  funds sold and  interest  bearing
deposits, a decrease of $1,739,000, or 16%, in accrued interest receivable,  and
a decrease of  $1,615,000,  or 8%, in premises  and  equipment.  The increase in
year-end  assets was partially a result of deposits  being  $44,177,000,  or 5%,
higher and federal funds purchased,  repurchase agreements and other notes being
$15,549,000, or 22%, higher at December 31, 2001 than at December 31, 2000 which
provided  additional  funds for the increase in loans and  investments.  Average
assets  were  $59,151,000,  or 6%,  higher in 2001 than  2000.  Included  in the
increase in average assets was an increase of $46,050,000, or 7%, in average net
loans  including  mortgage loans  held-for-sale,  an increase in average federal
funds sold and interest earning deposits of $16,838,000, or 74%, and an increase
in tax-exempt investment securities of $8,206,000,  or 18%. These increases were
somewhat  offset by a  decrease  of  $9,090,000,  or 3%, in  taxable  investment
securities, a decrease of $2,021,000,  or 9%, in other assets, and a decrease of
$1,305,000, or 6%, in premises and equipment. The increase in average assets was
a result of higher  average  deposits  and Federal  Home Loan Bank  advances and
other   borrowings.   There  was  an  increase  in  total  average  deposits  of
$45,400,000,  or 6%, in 2001 from  2000.  Included  in this  increase  were some
shifts in the average deposit mix in 2001 versus 2000.  Average interest bearing
demand deposits increased  $26,576,000,  or 33%, average time deposits increased
$16,285,000,  or 5%, and average  non-interest bearing demand deposits increased
$14,077,000,  or 16%.  Somewhat  offsetting  these  increases were a decrease in
average  interest  bearing  savings of  $6,442,000,  or 3%,  and a  decrease  of
$5,096,000, or 11%, in non-interest bearing savings deposits.

Investment Securities

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

                                                  Carrying Value of Securities
                                                         (in thousands)
                                                --------------------------------
December 31,                                      2001        2000        1999
--------------------------------------------------------------------------------
Securities available-for-sale:
     U.S. Treasury .........................    $  8,577    $ 23,812    $ 37,601
     Federal agencies ......................     191,325     156,322     139,812
     Mortgage-backed securities ............      28,279      11,513      14,870
     State and municipal ...................      15,642      15,349      10,220
     Corporate and other obligations .......       3,099         294         320
     Marketable equity securities ..........      19,574       6,396       4,021
                                                --------------------------------
               Total .......................    $266,496    $213,686    $206,844
                                                ================================

Securities held-to-maturity:
     Federal agencies ......................    $  1,750    $ 29,428    $ 28,994
     Mortgage-backed securities ............      19,842      22,642      27,193
     State and municipal ...................      42,226      32,902      33,748
                                                --------------------------------
               Total .......................    $ 63,818    $ 84,972    $ 89,935
                                                ================================

Other equity securities:
     FHLB and FRB stock 1 ..................    $  3,766    $  3,526    $  3,261
     Other equity investments ..............       1,342       1,003          --
                                                --------------------------------
               Total .......................    $  5,108    $  4,529    $  3,261
                                                ================================

               Total securities ............    $335,422    $303,187    $300,040
                                                ================================

1    FHLB and FRB are  commonly  used  acronyms  for Federal  Home Loan Bank and
     Federal Reserve Bank, respectively.
<PAGE>

The  unrealized  gain  on  securities  available-for-sale,  net of  tax  effect,
increased  $2,150,000,  to a gain of $2,750,000 at December 31, 2001 from a gain
of $600,000 at December 31, 2000.

The  following  table  shows  the  maturities  and  weighted-average  yields  of
investment securities at December 31, 2001:
<TABLE>
                                                       Maturities and Weighted Average Yields of Debt Securities
                                                                     (dollars in thousands)
                                  ----------------------------------------------------------------------------------------------
                                                                        December 31, 2001
                                  ----------------------------------------------------------------------------------------------
                                        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:
  U.S. Treasury ...............   $  5,493    5.83%   $  3,084    3.97%   $    --      --   $     --     --    $  8,577    5.16%
  Federal agencies ............     28,422    5.83%    160,890    4.95%     2,013    6.24%        --     --     191,325    5.09%
  Mortgage-backed securities1 .      4,384    4.22%     22,610    5.94%     1,285    5.28%        --     --      28,279    5.65%
  State and municipal .........        629    6.32%      6,174    6.14%     6,298    7.53%     2,541   7.63%     15,642    6.95%
  Other securities ............         --      --       3,099    5.32%        --      --         --     --       3,099    5.32%
  Marketable equity securities2         --      --          --      --         --      --         --     --      19,574      --
                                  ----------------------------------------------------------------------------------------------
          Total ...............   $ 38,928            $195,857           $  9,596           $  2,541           $266,496
                                  ==============================================================================================
Average Yield .................               5.66%               5.09%              6.96%             7.63%               5.28%
                                  ==============================================================================================
Securities held-to-maturity:
  Federal agencies ............   $     --      --    $  1,750    6.04%  $     --      --   $     --     --    $  1,750    6.04%
  Mortgage-backed securities1 .      8,869    5.23%      9,511    6.29%        --      --      1,462   6.34%     19,842    5.82%
  State and municipal .........      2,448    6.73%     31,885    6.28%     7,893    7.14%        --     --      42,226    6.47%
                                  ----------------------------------------------------------------------------------------------
          Total ...............   $ 11,317            $ 43,146           $  7,893           $  1,462           $ 63,818
                                  ==============================================================================================
Average Yield .................               5.55%               6.27%              7.14%             6.34%               6.25%
                                  ==============================================================================================
Other equity securities2
  FHLB and FRB stock ..........   $     --      --    $     --      --   $     --      --   $     --     --    $  3,766       --
  Other equity investments ....         --      --          --      --         --      --         --     --       1,342       --
                                  ----------------------------------------------------------------------------------------------
         Total ................   $     --      --    $     --      --   $     --      --   $     --     --    $  5,108       --
                                  ==============================================================================================
<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    Due to the nature of these  securities,  they do not have a stated maturity
     date or rate.
</FN>
</TABLE>

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; and installment and consumer loans.
<TABLE>
                                                     Amount of Loans Outstanding
                                                       (dollars in thousands)
                                         ----------------------------------------------------
                                           2001       2000       1999       1998       1997
                                         ----------------------------------------------------
<S>                                      <C>        <C>        <C>        <C>        <C>
Commercial, financial and agricultural   $246,042   $219,541   $188,430   $168,862   $167,752
Real estate ..........................    316,693    319,412    293,761    240,529    234,976
Installment and consumer .............    119,585    129,775    128,085    101,580    112,360
                                         ----------------------------------------------------
     Total loans .....................   $682,320   $668,728   $610,276   $510,971   $515,088
                                         ====================================================
</TABLE>
<PAGE>

<TABLE>
                                                    Percentage of Loans Outstanding
                                            -----------------------------------------------
                                              2001      2000      1999      1998      1997
-------------------------------------------------------------------------------------------
<S>                                         <C>       <C>       <C>       <C>       <C>
Commercial, financial and agricultural       36.06%    32.83%    30.88%    33.05%    32.57%
Real estate ..........................       46.41%    47.76%    48.13%    47.07%    45.62%
Installment and consumer .............       17.53%    19.41%    20.99%    19.88%    21.81%
                                            -----------------------------------------------
     Total ...........................      100.00%   100.00%   100.00%   100.00%   100.00%
                                            ===============================================
</TABLE>

Total loans increased  $13,592,000,  or 2.0%, from December 31, 2000 to December
31, 2001,  with increases in  commercial,  financial and  agricultural  loans of
$26,501,000,  offset somewhat by decreases in installment and consumer loans and
real estate loans of $10,190,000 and $2,719,000, respectively.

Total loans increased  $58,452,000,  or 9.6%, from December 31, 1999 to December
31, 2000, with increases in commercial,  financial and agricultural  loans, real
estate loans, and installment and consumer loans of $31,111,000, $25,651,000 and
$1,690,000,  respectively.  Strong loan demand was  responsible  for the overall
increase in loans from 1999 to 2000.

The balance of loans  outstanding as of December 31, 2001 by maturities is shown
in the following table:

                          Maturity of Loans Outstanding
                             (dollars in thousands)
<TABLE>
                                                       December 31, 2001
                                         --------------------------------------------
                                          1 year       1-5        over 5
                                          or less      years      years       Total
                                         --------------------------------------------
<S>                                      <C>         <C>         <C>         <C>
Commercial, financial and agricultural   $113,822    $100,385    $ 31,835    $246,042
Real estate ..........................     41,684     112,380     162,629     316,693
Installment and consumer .............     38,036      74,294       7,255     119,585
                                         --------------------------------------------
     Total ...........................   $193,542    $287,059    $201,719    $682,320
                                         ============================================

Percentage of total loans outstanding      28.37%      42.07%      29.56%     100.00%
                                         ============================================
</TABLE>

As of December 31,  2001,  commercial,  financial  and  agricultural  loans with
maturities of greater than one year were  comprised of $74,266,000 in fixed-rate
loans and $57,954,000 in floating-rate  loans. Real estate loans with maturities
greater than one year at December 31, 2001  included  $88,621,000  in fixed-rate
loans and $186,388,000 in floating-rate loans.
<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.

                            Allowance for Loan Losses
                             (dollars in thousands)
<TABLE>
                                               2001        2000        1999        1998        1997
-----------------------------------------------------------------------------------------------------
<S>                                           <C>         <C>         <C>         <C>         <C>
Allowance for loan losses at
  beginning of year .......................   $ 8,879     $ 8,682     $ 8,852     $ 8,837     $ 8,969
                                              -------------------------------------------------------
Charge-offs during period:
  Commercial, financial and agricultural ..   $(1,165)    $   (99)    $  (506)    $  (200)    $  (198)
  Residential real estate .................       (27)        (34)         --         (15)        (25)
  Installment and consumer ................    (1,481)     (1,119)       (750)       (933)     (1,383)
                                              -------------------------------------------------------
          Total ...........................   $(2,673)    $(1,252)    $(1,256)    $(1,148)    $(1,606)
                                              -------------------------------------------------------

Recoveries of loans previously charged off:
  Commercial, financial and agricultural ..   $   179     $   463     $   268     $    52     $   154
  Residential real estate .................        37           9          53          14         146
  Installment and consumer ................       167         173         192         288         277
                                              -------------------------------------------------------
          Total ...........................   $   383     $   645     $   513     $   354     $   577
                                              -------------------------------------------------------

          Net charge-offs .................   $(2,290)    $  (607)    $  (743)    $  (794)    $(1,029)
Provision for loan losses .................     2,670         804         573         809         897
                                              -------------------------------------------------------
Allowance for loan losses at end of year ..   $ 9,259     $ 8,879     $ 8,682     $ 8,852     $ 8,837
                                              =======================================================
Ratio of net charge-offs to
  average net loans .......................     0.34%       0.10%       0.14%       0.16%       0.21%
                                              =======================================================
</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.

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.  The  majority  of the
increased  charge-offs in commercial,  financial,  and agricultural loans during
2001  was due to two  agricultural  credits  totaling  $847,000.  The  level  of
charge-offs  of  installment  and  consumer  loans in 1999,  2000,  and 2001 was
reflective of the significant  growth of the indirect loan portfolio in 1999 and
2000.
<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)
                                           ------------------------------------------
                                            2001     2000     1999     1998     1997
                                           ------------------------------------------
<S>                                        <C>      <C>      <C>      <C>      <C>
Allocated:
  Commercial, financial and agricultural   $5,487   $3,426   $3,476   $4,038   $4,340
  Residential real estate ..............      419      855      799    1,040    1,446
  Installment and consumer .............    2,000    1,649    1,289    1,332    1,343
                                           ------------------------------------------
       Total allocated allowance .......   $7,906   $5,930   $5,564   $6,410   $7,129
Unallocated allowances .................    1,353    2,949    3,118    2,442    1,708
                                           ------------------------------------------
Total ..................................   $9,259   $8,879   $8,682   $8,852   $8,837
                                           ==========================================
</TABLE>

The portion of the allowance for loan losses which was unallocated  decreased by
$1,596,000 to $1,353,000 at December 31, 2001 from  $2,949,000 a year earlier as
the method of  allocation  was adjusted to be  consistent  among all  subsidiary
Banks.  This  resulted in more of the allowance  being  allocated to the riskier
components of commercial,  financial and agricultural (to $5,487,000 at December
31,  2001  from   $3,426,000  a  year  earlier)  and  installment  and  consumer
($2,000,000  at December 31, 2001 compared to  $1,649,000 a year earlier)  while
less was allocated to the low risk  residential real estate component (down from
$855,000 at December 31, 2000 to $419,000 at December 31, 2001). 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 allocations.

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."

                                                 Nonperforming Loans
                                                   (in thousands)
                                ------------------------------------------------
                                    2001       2000     1999      1998     1997
--------------------------------------------------------------------------------

Nonaccrual loans .............. 1 $ 3,341    1 $602   1 $112   1 $1,507 1 $2,530

Loans past due 90 days or more    $ 1,774      $846     $440     $1,084   $1,170

Renegotiated loans ............   $    67      $ 88     $104     $  121   $  140

1    Includes $3,216,000,  $505,000, $112,000, $787,000 and $700,000 at December
     31,  2001,  2000,  1999,  1998  and  1997,  respectively,  of  loans  which
     management  does not  consider  impaired  as  defined by the  Statement  of
     Financial  Accounting  Standards  No. 114,  "Accounting  by  Creditors  for
     Impairment of a Loan" (SFAS 114).

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

At December  31, 2001,  the Company had  approximately  $5,136,000  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 $5,136,000 of potential problem loans have either had timely payments or are
adequately  secured  and loss of  principal  or  interest  is  determined  to be
unlikely.
<PAGE>

Loans over 90 days past due,  which are not well  secured  and in the process of
collection, are placed on nonaccrual status. There were $3,341,000 of nonaccrual
loans at December  31, 2001  compared to  $602,000  at December  31,  2000.  The
increase  in  nonaccrual  loans was  primarily  due to  identified  agricultural
credits.  One of the credits was charged down by $700,000  prior to December 31,
2001 and the remaining balances of both credits are substantially secured. Loans
past due 90 days or more but still  accruing  increased by $928,000 in 2001 to a
balance of $1,774,000 at December 31, 2001,  from $846,000 at December 31, 2000.
These loans are well secured and in the process of collection.

The following table  categorizes  nonaccrual loans as of December 31, 2001 based
on levels of performance  and also details the allocation of interest  collected
during  the period in 2001 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 some  periodic  payments
would be included in the limited performance category.

                    Nonaccrual and Related Interest Payments
                                 (in thousands)
<TABLE>

                                        At December 31,     Cash Interest Payments Applied As:
                                             2001          -----------------------------------
                                      -------------------             Recovery of    Reduction
                                       Book   Contractual  Interest  Prior Partial      of
                                      Balance   Balance     Income    Charge-offs    Principal
                                      --------------------------------------------------------
<S>                                   <C>     <C>          <C>       <C>             <C>
Contractually past due with:
  Substantial performance .........   $  344    $  344     $   58      $   --         $   71
  Limited performance .............      224       235          4          --              5
  No performance ..................    2,773     2,890         --          --             --
                                      ------------------------------------------------------
Total .............................   $3,341    $3,469     $   62      $   --         $   76
                                      ======================================================
</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, 2001 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  decreased  $1,615,000  in 2001 from 2000.  This
decrease was primarily due to depreciation expense of $2,731,000,  proceeds from
sale of property  of $35,000 and loss on disposal of property of $41,000.  These
decreases were somewhat offset by $1,192,000 of purchases.

Other Assets

Other assets increased $412,000 in 2001 from 2000. This change was primarily due
to an increase in cash surrender value of life insurance.
<PAGE>

Deposits

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

              Average Balance and Weighted Average Rate of Deposits
                             (dollars in thousands)
<TABLE>
                                2001                  2000                 1999
                          -------------------------------------------------------------
                                    Weighted              Weighted             Weighted
                          Average   Average     Average   Average    Average   Average
                          Balance     Rate      Balance     Rate     Balance     Rate
                         --------------------------------------------------------------
<S>                      <C>        <C>        <C>        <C>       <C>        <C>
Demand
  Non-interest bearing   $102,136       --     $ 88,059       --    $ 97,856       --
  Interest bearing ...    107,992     2.06%      81,416     2.59%     93,885     2.32%
Savings
  Non-interest bearing     42,810       --       47,906       --      33,896       --
  Interest bearing ...    229,493     2.94%     235,935     3.82%    230,298     3.32%
Time
  $100,000 and over ..    110,966     4.73%      93,761     5.81%     86,418     5.19%
  Under $100,000 .....    249,624     5.85%     250,544     5.62%    237,641     5.30%
                         -------------------------------------------------------------
     Totals ..........   $843,021              $797,621             $779,994
                         =============================================================
</TABLE>

In analyzing  its deposit  activity,  management  has noted that  average  total
deposits increased  $45,400,000,  or 6%, during 2001.  Included in this increase
were shifts in the average deposit mix in 2001 versus 2000. There were increases
in average interest bearing demand deposits of $26,576,000, or 33%, average time
$100,000  and over of  $17,205,000,  or 18%,  and average  non-interest  bearing
demand deposits of $14,077,000, or 16%. Somewhat offsetting these increases were
decreases in average  interest  bearing  savings of  $6,442,000,  or 3%, average
non-interest  bearing savings  deposits of $5,096,000,  or 11%, and average time
deposits under $100,000 of $920,000, or less than 1%.

The table below sets forth the  maturity of deposits  greater  than  $100,000 at
December 31, 2001:

                  Maturity of Time Deposits of $100,000 or More
                                 (in thousands)
<TABLE>
                                                                                   Total Time
                               State of Illinois  Brokered                         Deposits of
Maturity at December 31, 2001     Time Deposit      CDs        CDs       IRAs    $100,000 or More
-------------------------------------------------------------------------------------------------
<S>                            <C>               <C>        <C>        <C>       <C>
3 months or less ........          $  5,000      $     --   $ 47,976   $    985     $ 53,961
3 to 6 months ...........             5,000            --     15,760        895       21,655
6 to 12 months ..........                --            --     24,989      1,125       26,114
Over 12 months ..........               200        12,000     23,588      2,524       38,312
                                   ---------------------------------------------------------
     Total ..............          $ 10,200      $ 12,000   $112,313   $  5,529     $140,042
                                   =========================================================
</TABLE>

Federal Funds Purchased, Repurchase Agreements and Notes Payable

This category  includes federal funds purchased,  which are generally  overnight
transactions, securities sold under repurchase agreements, which mature from one
day to three years from the date of sale and U.S.  Treasury  demand  notes.  The
table in note 8 in the  Notes to  Consolidated  Financial  Statements  shows the
balances of federal funds purchased,  repurchase agreements and notes payable at
December 31, 2001 and 2000, the average balance for the years ended December 31,
2001, 2000 and 1999, 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, 2001 and 2000,  are  disclosed in note 17 in the
Notes to Consolidated Financial Statements.
<PAGE>

Capital

Total  shareholders'  equity rose $10,591,000 from  $125,402,000 in December 31,
2000 to $135,993,000  at December 31, 2001. The increase  represented net income
of $16,171,000,  an increase in accumulated other comprehensive income (loss) of
$2,150,000  and a $23,000  increase from stock  appreciation  rights.  Decreases
included cash dividends declared of $4,945,000,  net treasury stock transactions
of $2,802,000  and the purchase of $6,000 in  fractional  shares of common stock
following the stock dividend.

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 Banks 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
December  31,  2001 and 2000 was 11.8% and  11.6%,  respectively.  The  leverage
ratios  for the  individual  banks  are  disclosed  in note 19 in the  Notes  to
Consolidated Financial Statements. All are 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 December 31, 2001 and 2000 was
18.0%  and   18.6%--significantly   higher  than  the  regulatory  minimum.  The
individual banks' total risk-weighted  assets ratios are disclosed in note 19 in
the Notes to Consolidated  Financial  Statements.  All are 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  (loss),  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.  The  Company
monitors the demand for cash and  initiates  programs and policies as considered
necessary to meet funding gaps.

The Company was able to adequately  fund loan demand and meet liquidity needs in
2001. A review of the  consolidated  statement of cash flows in the accompanying
financial  statements  shows  that  the  Company's  cash  and  cash  equivalents
increased  $11,240,000 from December 31, 2000 to December 31, 2001. The increase
in 2001 resulted from  operating and financing  activities,  somewhat  offset by
investing activities.  There were differences in sources and uses of cash during
2001  compared to 2000.  Less cash was used in the area of investing  activities
during 2001 compared to 2000. Funding of new loans decreased in 2001 compared to
2000,  as the growth of the loan  portfolio in 2001 was not as great as in 2000.
Principal paydowns from mortgage-backed  securities were slightly higher in 2001
compared to 2000.  These sources were somewhat offset by higher net purchases of
investments in debt and equity securities  compared to proceeds from maturities,
calls and sales of the same. There was an increase in cash provided by financing
activities.  This was mainly due to an  increase  in  federal  funds  purchased,
repurchase  agreements and notes payable in 2001 compared to a decrease in 2000.
This  source  of funds  was  somewhat  offset  by a use of  funds to repay  FHLB
advances and other borrowings in 2001 compared to a source of funds in 2000 when
borrowings  increased.  Less cash was provided by operating  activities  in 2001
compared  to 2000.  This was mainly due to more funds used for loans  originated
for sale offset  somewhat by more  proceeds from sales of loans  originated  for
sale in 2001 compared to 2000 due to lower interest rates.

The Company's future short-term cash requirements are expected to continue to be
provided by investment maturities, sales of loans and deposits. Cash required to
meet longer-term  liquidity  requirements will mostly depend on future goals and
strategies of management,  the  competitive  environment,  economic  factors and
changes in the needs of  customers.  No outside  borrowing is  anticipated.  The
Company  expects to maintain FHLB advances  near the current  level.  If current
sources of liquidity  cannot provide needed cash in the future,  the Company can
obtain  funds from  several  sources.  The Company is able to borrow  funds on a
temporary basis from the Federal Reserve Bank, the FHLB and correspondent  banks
to meet short-term  requirements.  With no parent company debt and sound capital
levels,  the Company has several options for longer-term cash needs, such as for
future expansion and acquisitions.
<PAGE>

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.

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.

The following table shows the Company's  interest rate  sensitivity  position at
various intervals at December 31, 2001:

       Rate Sensitivity of Earning Assets and Interest Bearing Liabilities
                                 (in thousands)
<TABLE>
                                                          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    $    7,484    $       --   $       --    $       --    $       --   $    7,484
  Debt and equity securities1 .....................       27,571        22,373       24,396        32,014       229,068      335,422
  Loans2 ..........................................      166,727        31,815       35,054        62,885       394,614      691,095
                                                      ------------------------------------------------------------------------------
       Total interest earning assets ..............   $  201,782    $   54,188   $   59,450    $   94,899    $  623,682   $1,034,001
                                                      ------------------------------------------------------------------------------

Interest bearing liabilities:
  Savings and interest bearing demand deposits3 ...   $   34,625    $    1,374   $    2,061    $    4,126    $  161,938   $  204,124
  Money market savings deposits ...................      149,554            --           --            --            --      149,554
  Time deposits ...................................       54,140        50,310       65,923        82,727       118,524      371,624
  Federal funds purchased, repurchase agreements
    and notes payable .............................       82,713            27          504         1,477           486       85,207
  FHLB Advances and other borrowings ..............           --           161           --         7,000        27,734       34,895
                                                      ------------------------------------------------------------------------------
       Total interest bearing liabilities .........   $  321,032    $   51,872   $   68,488    $   95,330    $  308,682   $  845,404
                                                      ==============================================================================

Net asset (liability) funding gap .................   $ (119,250)   $    2,316   $   (9,038)   $     (431)   $  315,000   $  188,597
                                                      ------------------------------------------------------------------------------

Repricing gap .....................................         0.63          1.04         0.87          1.00          2.02         1.22
Cumulative repricing gap ..........................         0.63          0.69         0.71          0.76          1.22         1.22
                                                      ==============================================================================
<FN>
1    Debt and equity securities include securities available-for-sale.

2    Loans include mortgage loans held-for-sale.

3    The total of savings and interest  bearing demand deposits does not include
     $25,401,000 of  non-transactional  accounts which are savings accounts that
     are non-interest bearing.
</FN>
</TABLE>

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 Days  31-90 Days  91-180 Days   181-365 Days  Over 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>
<PAGE>

At December 31, 2001,  the Company  tended to be 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 $1,193,000 in 30 days and $1,169,000 in 90 days assuming
no  management  intervention.  A rise in interest  rates would have the opposite
effect for the same periods.

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.  Additionally,  the  Company  can borrow
approximately $35,975,000 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, 2001 and December
31,  2000 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.

Basis Point Change

                                    +200     +100     -100     -200
                                    -------------------------------

December 31, 2001 ...........       6.6%     3.3%    (3.3%)   (5.6%)
December 31, 2000 ...........       0.2%     0.1%    (0.1%)   (0.2%)

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.

New Accounting Rules and Regulations

In June 2001, the Financial Accounting Standards Board issued Statement No. 141,
"Business  Combinations"  (SFAS  No.  141).  SFAS No.  141  addresses  financial
accounting  and reporting for business  combinations  and supersedes APB Opinion
No. 16, "Business Combinations", and SFAS No. 38, "Accounting for Preacquisition
Contingencies  of  Purchased  Enterprises".  SFAS No. 141  requires all business
combinations  in the scope of this SFAS to be  accounted  for using the purchase
method. SFAS No. 141 is effective for business combinations initiated after June
30, 2001 and all business  combinations  accounted for using the purchase method
for which the  acquisition  date is July 1, 2001 or later.  Management  does not
believe the adoption of Statement No. 141 will have a significant  impact on its
financial statements.
<PAGE>

In June 2001, the Financial Accounting Standards Board issued Statement No. 142,
"Goodwill  and Other  Intangible  Assets"  (SFAS  142).  SFAS No. 142  addresses
financial  accounting and reporting for acquired  goodwill and other  intangible
assets and supersedes APB Opinion No. 17, "Intangible  Assets". It addresses how
intangible  assets  should be accounted  for at  acquisition  and in  subsequent
periods. Most significantly, goodwill and intangible assets that have indefinite
useful lives will not be amortized  but rather will be tested at least  annually
for impairment. Intangible assets that have finite useful lives will continue to
be  amortized  over their useful  lives.  The standard  also  provides  specific
guidelines  for  testing   goodwill  for  impairment  and  requires   additional
disclosures about goodwill and intangible assets.  SFAS No. 142 is effective for
fiscal years  beginning  after December 15, 2001. SFAS No. 142 is required to be
applied to the  beginning of any  entity's  fiscal year and to be applied to all
goodwill and other intangible assets  recognized in its financial  statements at
that date. Impairment losses for goodwill and indefinite-lived intangible assets
that arise due to the initial application of this Standard are to be reported as
resulting from a change in accounting principle. Management does not believe the
adoption  of SFAS No.  142  will  have a  significant  impact  on its  financial
statements.

In June 2001,  Statement on Financial  Accounting Standards No. 143, "Accounting
for Asset Retirement Obligations", was issued to address financial reporting and
obligations associated with the retirement of tangible long-lived assets and the
associated asset retirement costs. This Statement applies to all entities and to
legal  obligations  associated  with the  retirement of  long-lived  assets that
result from the acquisition,  construction, development or normal operation of a
long-lived asset, except for certain  obligations of lessees.  Statement No. 143
is effective for financial  statements  issued for fiscal years  beginning after
June 15, 2002.  Management  does not believe the  adoption of Statement  No. 143
will have a significant impact on its financial statements.

In August 2001, Statement on Financial Accounting Standards No. 144, "Accounting
for the  Impairment or Disposal of Long-Lived  Assets",  was issued to supersede
Statement No. 121,  "Accounting for the Impairment and for Long-Lived  Assets to
Be Disposed Of", and the accounting and reporting  provisions of APB Opinion No.
30,  "Reporting the Results of Operations - Reporting the Effects of Disposal of
a Segment of a Business,  and Extraordinary,  Unusual and Infrequently Occurring
Events  and  Transactions".   Statement  No.  144  is  effective  for  financial
statements  issued for fiscal years  beginning  after  December  15,  2001,  and
interim periods within those fiscal years,  with early  application  encouraged.
Management  does not  believe  the  adoption  of  Statement  No. 144 will have a
significant impact on its financial statements.

Safe Harbor Statement Under the Private Securities Litigation Reform Act of 1996

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.  Factors which could have a material adverse
effect  on  the  operations  and  future   prospects  of  the  Company  and  its
subsidiaries include, but are not limited to, the following:

o    The  strength of the United  States  economy in general and the strength of
     the local economies in which the Company  conducts its operations which may
     be less  favorable  then expected and may result in, among other things,  a
     deterioration in the credit quality and value of the Company's assets.

o    The economic  impact of the  terrorist  attacks that  occurred on September
     11th,  as well as any future  threats and attacks,  and the response of the
     United States to any such threats and attacks.

o    The effects of, and changes in, federal,  state and local laws, regulations
     and policies  affecting  banking,  securities,  insurance  and monetary and
     financial matters.
<PAGE>

o    The effects of changes in interest rates  (including the effects of changes
     in the rate of prepayments of the Company's assets) and the policies of the
     Board of Governors of the Federal Reserve System.

o    The ability of the Company to compete with other financial  institutions as
     effectively  as  the  Company   currently   intends  due  to  increases  in
     competitive pressures in the financial services sector.

o    The inability of the Company to obtain new customers and to retain existing
     customers.

o    The timely  development and acceptance of products and services,  including
     products and services offered through alternative delivery channels such as
     the Internet.

o    Technological  changes  implemented  by the Company  and by other  parties,
     including  third  party  vendors,  which  may be  more  difficult  or  more
     expensive than anticipated or which may have unforeseen consequences to the
     Company and its customers.

o    The  ability of the  Company to develop and  maintain  secure and  reliable
     electronic systems.

o    The ability of the Company to retain key  executives  and employees and the
     difficulty  that the Company may experience in replacing key executives and
     employees in an effective manner.

o    Consumer  spending  and saving  habits  which may  change in a manner  that
     affects the Company's business adversely.

o    Business  combinations and the integration of acquired businesses which may
     be more difficult or expensive than expected.

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 and the  Financial  Accounting  Standards
     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.
Additional information concerning the Company and its business,  including other
factors  that  could  materially  affect the  Company's  financial  results,  is
included in the Company's filings with the Securities and Exchange Commission

Item 7a.  Quantitative and Qualitative Disclosures about Market Risk

See pages 26 through 27.

Item 8.  Financial Statements and Supplementary Data
<PAGE>



                             MAIN STREET TRUST, INC.
                                AND SUBSIDIARIES

                        Consolidated Financial Statements

                        December 31, 2001, 2000 and 1999


<PAGE>



                             MAIN STREET TRUST, INC.
                                AND SUBSIDIARIES

                                TABLE OF CONTENTS

INDEPENDENT AUDITOR'S REPORT

CONSOLIDATED FINANCIAL STATEMENTS
Consolidated Balance Sheets

Consolidated Statements of Income

Consolidated Statements of Changes in Shareholders' Equity

Consolidated Statements of Cash Flows

Notes to Consolidated Financial Statements


<PAGE>





                          Independent Auditor's Report

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

We have  audited  the  accompanying  consolidated  balance  sheet of Main Street
Trust,  Inc. and  subsidiaries as of December 31, 2001 and 2000, and the related
consolidated  statements of income,  changes in shareholders'  equity,  and cash
flows for the years then ended. These consolidated  financial statements are the
responsibility of the Company's management.  Our responsibility is to express an
opinion on these consolidated financial statements based on our audits.

We conducted our audits in accordance with auditing standards generally accepted
in the  United  States of  America.  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, 2001 and 2000, and the
results of their  operations  and their cash flows for the years then ended,  in
conformity with accounting principles generally accepted in the United States of
America.

We  previously  audited and reported on the  consolidated  statements of income,
changes  in  shareholders'  equity  and  cash  flows of  BankIllinois  Financial
Corporation and subsidiary for the year ended December 31, 1999,  prior to their
restatement for the 2000 pooling of interests.  The contribution of BankIllinois
Financial Corporation and subsidiary to total shareholders' equity, net interest
income,  and net income  represented  54.9%,  55.4% and 64.6% of the  respective
restated  totals for the year  ended  December  31,  1999.  The other  companies
included in the December 31, 1999  restated  consolidated  statements of income,
changes  in  shareholders'  equity  and cash  flows for the year then ended were
audited and reported on  separately  by other  auditors;  and their report dated
January 28, 2000 expressed an unqualified opinion on those financial statements.
We also audited the combination of the accompanying  consolidated  statements of
income,  changes  in  shareholders'  equity  and cash  flows for the year  ended
December 31, 1999, after  restatement for the 2000 pooling of interests;  in our
opinion,  such consolidated  financial statements have been properly combined on
the basis described in Note 2 to the consolidated financial statements.


/s/ McGladrey & Pullen, LLP


Champaign, Illinois
February 8, 2002
<PAGE>


                             MAIN STREET TRUST, INC.
                                AND SUBSIDIARIES

                           Consolidated Balance Sheets
                           December 31, 2001 and 2000
                        (in thousands, except share data)
<TABLE>
                                                                                 2001         2000
                                                                             -------------------------
<S>                                                                          <C>            <C>
Assets
Cash and due from banks ...............................................      $   87,895     $   58,967
Federal funds sold and interest bearing deposits ......................           7,484         25,172
                                                                             -------------------------
         Cash and cash equivalents                                               95,379         84,139
                                                                             -------------------------
Investments in debt and equity securities:
  Available-for-sale, at fair value ...................................          266,496       213,686
  Held-to-maturity, at cost (fair value of $64,727 and $84,849 at
    December 31, 2001 and 2000, respectively) .........................           63,818        84,972
  Other equity securities .............................................            5,108         4,529
                                                                             -------------------------
         Total investments in debt and equity securities ..............          335,422       303,187
                                                                             -------------------------
Loans, net of allowance for loan losses of $9,259 and
  $8,879 at December 31, 2001 and 2000, respectively ..................          673,061       659,849
Mortgage loans held for sale ..........................................            8,775         2,090
Premises and equipment ................................................           19,259        20,874
Accrued interest receivable ...........................................            8,890        10,629
Other assets ..........................................................           10,725        10,313
                                                                             -------------------------
               Total assets ...........................................      $ 1,151,511   $ 1,091,081
                                                                             =========================

Liabilities and Shareholders' Equity
Deposits:
  Demand, non-interest bearing ........................................      $   133,406    $  108,981
  Demand, interest bearing ............................................          111,241        87,517
  Savings .............................................................          267,838       286,123
  Time, $100 and over .................................................          140,042       100,030
  Other time ..........................................................          231,582       257,281
                                                                              ------------------------
               Total deposits                                                    884,109       839,932
Federal funds purchased, repurchase agreements, and notes payable .....           85,207        69,658
Federal  Home Loan Bank  advances  and  other  borrowings .............           34,895        40,978
Accrued interest payable ..............................................            3,390         4,584
Other liabilities .....................................................            7,917        10,527
                                                                              ------------------------
               Total liabilities ......................................        1,015,518       965,679
                                                                              ------------------------
Shareholders' equity:
  Preferred stock, no par value; 2,000,000 shares authorized ..........               --            --
  Common stock, $0.01 par  value; 15,000,000 shares authorized;
    11,111,281 and 11,111,582 shares issued at December 31, 20001
    and 2000, respectively ............................................              111            111
  Paid in capital .....................................................           54,147         54,222
  Retained earnings ...................................................           83,810         72,591
  Accumulated other comprehensive income ..............................            2,750            600
                                                                              -------------------------
                                                                                 140,818        127,524
  Less:  treasury stock, at cost, 267,783 and 117,786 shares at
    December 31, 2001 and 2000, respectively ..........................           (4,825)        (2,122)
                                                                              -------------------------
               Total shareholders' equity .............................          135,993        125,402
                                                                              -------------------------
               Total liabilities and shareholders' equity .............       $1,151,511     $1,091,081
                                                                              =========================
</TABLE>
See accompanying notes to consolidated financial statements.
<PAGE>


                             MAIN STREET TRUST, INC.
                                AND SUBSIDIARIES

                        Consolidated Statements of Income
                  Years Ended December 31, 2001, 2000 and 1999
                        (in thousands, except share data)
<TABLE>

                                                                 2001            2000         1999
                                                              ----------------------------------------
<S>                                                           <C>            <C>           <C>
Interest income:
  Loans and fees on loans .................................   $    55,280    $    55,154   $    47,041
  Investments in debt and equity securities:
    Taxable ...............................................        13,831         15,533        16,855
    Tax-exempt ............................................         2,347          2,031         1,948
  Federal funds sold and interest bearing deposits ........         1,737          1,553         1,226
                                                              ----------------------------------------
        Total interest income .............................        73,195         74,271        67,070
                                                              ----------------------------------------
Interest expense:
  Demand, savings, and other time deposits ................        23,586         25,213        22,427
  Time deposits $100 and over .............................         5,245          5,451         4,490
  Federal funds purchased, repurchase agreements,
    and notes payable .....................................         2,550          3,764         3,110
  Federal Home Loan Bank advances and other borrowings ....         2,217          2,171         1,686
                                                              ----------------------------------------
        Total interest expense ............................        33,598         36,599        31,713
                                                              ----------------------------------------
        Net interest income ...............................        39,597         37,672        35,357
Provision for loan losses .................................         2,670            804           573
                                                              ----------------------------------------
        Net interest income after provision for loan losses        36,927         36,868        34,784
                                                              ----------------------------------------
Non-interest income:
  Remittance processing ...................................         7,187          6,605         8,151
  Trust and brokerage fees ................................         5,227          5,474         4,898
  Service charges on deposit accounts .....................         2,217          2,087         2,006
  Securities transactions, net ............................           110             21           141
  Gain on sales of mortgage loans, net ....................           828            212           527
  Other ...................................................         1,532          1,837         2,135
                                                              ----------------------------------------
        Total non-interest income .........................        17,101         16,236        17,858
                                                              ----------------------------------------
Non-interest expense:
  Salaries and employee benefits ..........................        17,761         18,274        18,775
  Occupancy ...............................................         2,297          2,220         2,407
  Equipment ...............................................         3,405          3,652         3,373
  Data processing fees ....................................         1,943          1,470         1,280
  Office supplies .........................................         1,535          1,236         1,255
  Service charges from correspondent banks ................           885            998         1,428
  Merger related professional fees ........................            --          2,544            --
  Reconciliation liability ................................        (2,500)            --         2,500
  Other ...................................................         4,795          4,295         4,771
                                                              ----------------------------------------
        Total non-interest expense ........................        30,121         34,689        35,789
                                                              ----------------------------------------

        Income before income taxes ........................        23,907         18,415        16,853
Income taxes ..............................................         7,736          6,426         5,165
                                                              ----------------------------------------
        Net income ........................................   $    16,171    $    11,989   $    11,688
                                                              ========================================
Per share data:
  Basic earnings per share ................................   $      1.48    $      1.08   $      1.05
  Weighted average shares of common stock outstanding .....    10,930,736     11,077,959    11,122,548
  Diluted earnings per share ..............................   $      1.45    $      1.06   $      1.03
  Weighted average shares of common stock and dilutive
    potential common shares outstanding ...................    11,138,290     11,300,674    11,360,888
</TABLE>
See accompanying notes to consolidated financial statements.
<PAGE>

                             MAIN STREET TRUST, INC.
                                AND SUBSIDIARIES

           Consolidated Statements of Changes in Shareholders' Equity
                  Years Ended December 31, 2001, 2000 and 1999
                        (in thousands, except share data)
<TABLE>
                                                                                       Accumulated
                                                                                          Other
                                                                                         Compre-
                                               Common Stock                              hensive      Treasury Stock
                                            -------------------    Paid-In    Retained    Income    --------------------
                                              Shares     Amount    Capital    Earnings    (Loss)      Shares     Amount      Total
                                            ---------------------------------------------------------------------------------------
<S>                                         <C>         <C>       <C>        <C>         <C>        <C>        <C>         <C>
Balance, January 1, 1999 .................  10,578,973  $   106   $  44,300  $  66,534   $  1,646         --   $      --   $112,586
Restated for 5% stock dividend - 2001 ....     528,922        5       9,916     (9,921)        --         --          --         --
                                            ---------------------------------------------------------------------------------------
Balance January 1, 1999, as restated .....  11,107,895      111      54,216     56,613      1,646         --          --    112,586
                                            ---------------------------------------------------------------------------------------
Comprehensive Income:
  Net income .............................          --       --          --     11,688         --         --          --     11,688
  Net change in unrealized gain (loss)
    on securities available-for-sale,
    net of taxes ($2,532) ................          --       --          --         --     (4,915)        --          --     (4,915)
  Reclassification adjustment, net of
    tax of ($48) .........................          --       --          --         --        (93)        --          --        (93)
                                                                                                                           --------
  Comprehensive income ...................                                                                                    6,680
                                                                                                                           --------
Fractional shares of common stock
  purchased following stock dividend .....        (211)       --         (5)        --         --         --          --         (5)
Stock appreciation rights ................          --        --         15         --         --         --          --         15
Cash dividends ($0.29 per share) .........          --        --         --     (3,195)        --         --          --     (3,195)
                                            ---------------------------------------------------------------------------------------
Balance, December 31, 1999 ...............  11,107,684       111     54,226     65,106     (3,362)        --          --    116,081
                                                                                                                           --------
Comprehensive Income:
  Net income .............................          --        --         --     11,989         --         --          --     11,989
  Net change in unrealized gain (loss)
    on securities available-for-sale,
    net of taxes of $2,051 ...............          --        --         --         --      3,976         --          --      3,976
  Reclassification adjustment, net of
    tax of $7 ............................          --        --         --         --        (14)        --          --        (14)
                                                                                                                           ---------
  Comprehensive income ...................                                                                                   15,951
                                                                                                                           ---------
Fractional shares of common stock
  purchased following stock dividend
  and merger .............................        (344)       --        (11)        --         --         --          --        (11)
Stock appreciation rights ................          --        --        (64)        --         --         --          --        (64)
Cash dividends ($0.40 per share) .........          --        --         --     (4,472)        --         --          --     (4,472)
Treasury stock transactions, net .........       4,242        --         71        (32)        --    117,786      (2,122)    (2,083)
                                            ----------------------------------------------------------------------------------------
Balance, December 31, 2000 ...............  11,111,582       111     54,222     72,591        600    117,786      (2,122)   125,402
                                                                                                                           ---------
Comprehensive Income:
  Net income .............................          --        --         --     16,171          --        --          --     16,171
  Net change in unrealized gain (loss) on
    securities available-for-sale, net of
    taxes of $1,172 ......................          --        --         --         --       2,221        --          --      2,221
  Reclassification adjustment, net of tax
    of ($39) .............................          --        --         --         --         (71)       --          --        (71)
                                                                                                                           ---------
  Comprehensive income ...................                                                                                   18,321
                                                                                                                           ---------
Fractional shares of common stock
  purchased following stock dividend .....        (301)       --         (6)        --          --        --          --         (6)
Stock appreciation rights ................          --        --         23         --          --        --          --         23
Cash dividends ($0.45 per share) .........          --        --         --     (4,945)         --        --          --     (4,945)
Treasury stock transactions, net .........          --        --        (92)        (7)         --   149,997      (2,703)    (2,802)
                                            ----------------------------------------------------------------------------------------
Balance, December 31, 2001 ...............  11,111,281   $   111  $  54,147   $ 83,810    $  2,750   267,783    ($ 4,825)  $135,993
                                            ========================================================================================
</TABLE>
See accompanying notes to consolidated financial statements.
<PAGE>


                             MAIN STREET TRUST, INC.
                                AND SUBSIDIARIES

                      Consolidated Statements of Cash Flows
                  Years Ended December 31, 2001, 2000 and 1999
                                 (in thousands)
<TABLE>
                                                                                2001         2000        1999
                                                                             -----------------------------------
<S>                                                                          <C>          <C>          <C>
Cash flows from operating activities:
  Net income .............................................................   $  16,171    $  11,989    $  11,688
  Adjustments to  reconcile  net income to net cash  provided by operating
    activities:
  Depreciation and amortization ..........................................       2,757        2,839        2,699
  Amortization of bond premiums, net .....................................         (78)         202          783
  Provision for loan losses ..............................................       2,670          804          573
  Deferred income taxes ..................................................      (1,643)         (26)        (975)
  Securities transactions, net ...........................................        (110)         (21)        (141)
  Federal Home Loan Bank stock dividend ..................................        (240)        (169)          --
  Gain on sales of mortgage loans, net ...................................        (828)        (212)        (527)
  Loss on disposal of premises and equipment .............................          41          587           27
  Proceeds from sales of mortgage loans originated for sale ..............     104,155       25,537       59,886
  Mortgage loans originated for sale .....................................    (110,012)     (25,728)     (49,179)
  Other, net .............................................................      (2,377)         647        1,851
                                                                             -----------------------------------
        Net cash provided by operating activities ........................      10,506       16,449       26,685
                                                                             -----------------------------------
Cash flows from investing activities:
  Net increase in loans ..................................................     (15,882)     (59,066)    (101,375)
  Proceeds from maturities and calls of investments in debt securities:
    Held-to-maturity .....................................................      32,239        3,456       19,164
    Available-for-sale ...................................................     140,054       38,727       85,529
  Proceeds from sales of investments in debt and equity securities:
    Available-for-sale ...................................................      29,567        9,619       34,573
    Purchases of investments in debt and equity securities:
      Held-to-maturity ...................................................     (21,744)      (3,054)     (21,608)
      Available-for-sale .................................................    (223,994)     (51,581)     (77,623)
      Other equity securities ............................................        (750)      (1,099)         (41)
    Principal paydowns from mortgage-backed securities:
       Held-to-maturity ..................................................       9,948        4,503        3,486
       Available-for-sale ................................................       6,127        2,272        4,253
    Return of principal on other equity securities .......................          31           --           --
    Purchases of premises and equipment ..................................      (1,192)      (1,769)      (3,928)
    Proceeds from sale of premises and equipment .........................          35           --           --
                                                                             -----------------------------------
        Net cash used in investing activities ............................     (45,561)     (57,992)     (57,570)
                                                                             -----------------------------------
Cash flows from financing activities:
  Net increase in deposits ...............................................      44,177       44,857       29,409
  Net increase  (decrease)  in federal  funds  purchased,
    repurchase agreements, and notes payable .............................      15,549       (9,482)      18,899
  Net (decrease) increase in Federal Home Loan Bank
    advances and other borrowings ........................................      (6,083)       8,920        4,154
  Cash dividends paid ....................................................      (4,540)      (3,869)      (3,176)
  MSTI post merger stock transactions, net ...............................      (2,808)      (2,094)          --
                                                                             -----------------------------------
        Net cash provided by financing activities ........................      46,295       38,332       49,286
                                                                             -----------------------------------
        Net increase (decrease) in cash and cash
        equivalents ......................................................      11,240       (3,211)      18,401
Cash and cash equivalents at beginning of year ...........................      84,139       87,350       68,949
                                                                             -----------------------------------
Cash and cash equivalents at end of year .................................   $  95,379    $  84,139    $  87,350
                                                                             ===================================

Supplemental disclosures of cash flow information:
  Cash paid during the year for:
    Interest .............................................................   $  34,792    $  36,105    $  31,624
    Income taxes .........................................................       8,775        6,684        6,819
  Real estate acquired through or in lieu of foreclosure .................        --             92          410
  Dividends declared not paid ............................................       1,452        1,047          444
</TABLE>
See accompanying notes to consolidated financial statements.
<PAGE>


                             MAIN STREET TRUST, INC.
                                AND SUBSIDIARIES

                   Notes to Consolidated Financial Statements

1. Organization

MainStreet  Trust,  Inc. is a holding company whose  subsidiaries  BankIllinois,
First National Bank of Decatur,  First Trust Bank of  Shelbyville  and FirsTech,
Inc., (the "Company") provide a full range of banking services to individual and
corporate  customers  located  within  Champaign,   Decatur,   and  Shelbyville,
Illinois,  and the  surrounding  communities.  The  subsidiaries  are subject to
competition  from other financial  institutions  and  nonfinancial  institutions
providing financial products. Additionally, the Company and its subsidiaries are
subject to the regulations of certain  regulatory  agencies and undergo periodic
examinations by those regulatory agencies.

2. Summary of Significant Accounting Policies

The  consolidated  financial  statements  of the Company  have been  prepared in
conformity  with  generally  accepted  accounting   principles  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 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.

The  significant  accounting  policies used by the Company in the preparation of
the consolidated financial statements are summarized below:

(a)  Principles of Consolidation and Financial Statement Presentation

     On August 12, 1999,  BankIllinois  Financial  Corporation and First Decatur
     Bancshares,  Inc.  entered  into an  agreement  and Plan of  Merger,  which
     provided for a "merger of equals" between the two companies,  structured as
     a merger of the two  companies  into the  Company.  The  merger,  which was
     completed  on March  23,  2000,  has been  accounted  for as a  pooling  of
     interests  and,  accordingly,  all  prior  financial  statements  have been
     restated  to include  both  companies.  As a result of the  merger,  former
     shareholders  of  BankIllinois  Financial  Corporation  and  First  Decatur
     Bancshares,  Inc. received 6,119,673 and 4,990,281 shares of Company common
     stock, respectively.

     The consolidated  financial  statements include the accounts of Main Street
     Trust, Inc. and its wholly owned subsidiaries, BankIllinois, First National
     Bank of  Decatur,  First  Trust  Bank of  Shelbyville,  (the  "Banks")  and
     FirsTech,   Inc.,  a  retail  payment   processing   company.   Significant
     intercompany   accounts   and   transactions   have  been   eliminated   in
     consolidation.

     Property  held by the Trust &  Investments  Division 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.

     The  Company  currently  operates  in two  industry  segments.  The primary
     business involves providing banking services to central Illinois. The Banks
     offer 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
     departments  that  offer  a wide  range  of  services  such  as  investment
     management,  acting as trustee, serving as guardian,  executor or agent and
     miscellaneous  consulting;  discount  brokerage  services 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. The Company  operates  primarily to
     manage its investment in the subsidiaries.  Company information is provided
     for  informational  purposes  only,  since it is not  considered a separate
     segment for reporting purposes.
<PAGE>

     The  following  is a summary  of  selected  data for the  various  business
     segments as of and for the year ending December 31:
<TABLE>
                                  Banking      Remittance
                                  Services      Services       Company     Eliminations      Total
                                ---------------------------------------------------------------------
<S>                             <C>           <C>             <C>          <C>            <C>
         2001
-----------------------------

Total interest income .......   $    73,122   $       135     $     111     $     (173)   $    73,195
Total interest expense ......        33,771            --            --           (173)        33,598
Provision for loan losses ...         2,670            --            --             --          2,670
Total non-interest income ...        10,504         7,543          (148)          (798)        17,101
Total non-interest expense ..        26,799         5,565        (1,445)          (798)        30,121
Income before income tax ....        20,386         2,113         1,408             --         23,907
Income tax expense ..........         6,355           790           591             --          7,736
Net income ..................        14,031         1,323           817             --         16,171
Total assets ................     1,143,675         7,208       138,392       (137,764)     1,151,511
Depreciation and amortization         2,178           549            30             --          2,757

         2000
-----------------------------

Total interest income .......   $    74,346   $       137     $     172     $     (384)   $    74,271
Total interest expense ......        36,983            --            --           (384)        36,599
Provision for loan losses ...           804            --            --             --            804
Total non-interest income ...         9,933         7,434           174         (1,305)        16,236
Total non-interest expense ..        25,317         5,849         4,828         (1,305)        34,689
Income before income tax ....        21,175         1,722        (4,482)            --         18,415
Income tax expense ..........         6,587           593          (754)            --          6,426
Net income ..................        14,588         1,129        (3,728)            --         11,989
Total assets ................     1,081,001         6,606       129,942       (126,468)     1,091,081
Depreciation and amortization         2,292           523            24             --          2,839

         1999
-----------------------------

Total interest income .......   $    67,105   $       106   $       180    $      (321)   $    67,070
Total interest expense ......        32,034            --            --           (321)        31,713
Provision for loan losses ...           573            --            --             --            573
Total non-interest income ...         9,944         8,718           127           (931)        17,858
Total non-interest expense ..        25,293         7,568         3,859           (931)        35,789
Income before income tax ....        19,149         1,256        (3,552)            --         16,853
Income tax expense ..........         5,946           426        (1,207)            --          5,165
Net income ..................        13,203           830        (2,345)            --         11,688
Total assets ................     1,025,562         6,565       118,667       (115,048)     1,035,746
Depreciation and amortization         2,238           437            24             --          2,699
</TABLE>

(b)  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.

     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  would  be  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 contractual lives.
<PAGE>

     A decline in the market value of any available-for-sale or held-to-maturity
     security  below  cost that is deemed  other  than  temporary  is charged to
     earnings  and  results  in the  establishment  of a new cost  basis for the
     security.

     Other equity securities include other investments which are carried at fair
     value  as well as  Federal  Reserve  Bank  stock  and the  Banks'  required
     investment  in the capital  stock of the  Federal  Home Loan Bank which are
     carried at cost which approximates fair value.

(c)  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. Net unrealized losses are recognized in a valuation
     allowance by charges to income.  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.

(d)  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,   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 loans 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.

     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.
<PAGE>

(e)  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.  Maintenance  and
     repairs are charged to operations as incurred.

(f)  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 difference is recorded as a valuation  allowance
     through a charge to income. Subsequent increases in fair value are recorded
     through a reversal of the valuation allowance, but not below zero. Expenses
     incurred in maintaining the properties are charged to operations.

(g)  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.

(h)  Earnings Per Share

     Basic earnings per share is computed by dividing net income by the weighted
     average  number of common 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  and  stock  appreciation
     rights, as discussed in Note 13 to the consolidated  financial  statements,
     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>
                                                                       2001          2000          1999
                                                                  -----------------------------------------
     <S>                                                          <C>             <C>           <C>
     Net income ...............................................   $  16,171,000   $11,989,000   $11,688,000
     Shares:
        Weighted average common shares outstanding ..........        10,930,736    11,077,959    11,122,548
        Dilutive effect of outstanding options, as determined
          by the application of the treasury stock method .             207,554       222,715       238,340
                                                                  -----------------------------------------
        Weighted average common shares outstanding,
          as adjusted .....................................          11,138,290    11,300,674    11,360,888
                                                                  =========================================
     Basic earnings per share .................................   $       1.48    $      1.08   $      1.05
                                                                  =========================================
     Diluted earnings per share ...............................   $       1.45    $      1.06   $      1.03
                                                                  =========================================
</TABLE>

(i)  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.

(j)  Stock Dividend

     During September 2001,  the  Company  effected  a 5%  stock  dividend.  All
     references in the accompanying financial statements to number of shares and
     per share  amounts  have been  retroactively  restated to reflect the stock
     dividends.
<PAGE>

(k)  Reclassification

     Certain amounts in the 1999 and 2000 consolidated financial statements have
     been   reclassified   to   conform   with  the  2001   presentation.   Such
     reclassifications have no effect on previously reported net income.

(l)  Emerging Accounting Standards

     In June 2001, the Financial Accounting Standards Board issued Statement No.
     141,  "Business  Combinations"  (SFAS  No.  141).  SFAS No.  141  addresses
     financial accounting and reporting for business combinations and supersedes
     APB Opinion No. 16, "Business  Combinations"  and SFAS No. 38,  "Accounting
     for Preacquisition  Contingencies of Purchased  Enterprises".  SFAS No. 141
     requires  all  business  combinations  in the  scope  of  this  SFAS  to be
     accounted  for using the purchase  method.  SFAS No. 141 is  effective  for
     business  combinations  initiated  after  June 30,  2001  and all  business
     combinations  accounted  for  using  the  purchase  method  for  which  the
     acquisition date is July 1, 2001 or later.  Management does not believe the
     adoption  of  Statement  No.  141 will  have a  significant  impact  on its
     financial statements.

     In June 2001, the Financial Accounting Standards Board issued Statement No.
     142,  "Goodwill  and Other  Intangible  Assets"  (SFAS  142).  SFAS No. 142
     addresses  financial  accounting  and reporting  for acquired  goodwill and
     other  intangible  assets and  supersedes  APB Opinion No. 17,  "Intangible
     Assets".  It addresses  how  intangible  assets  should be accounted for at
     acquisition and in subsequent  periods.  Most  significantly,  goodwill and
     intangible  assets that have indefinite  useful lives will not be amortized
     but rather  will be tested at least  annually  for  impairment.  Intangible
     assets that have finite  useful lives will  continue to be  amortized  over
     their  useful  lives.  The standard  also  provides  specific  guidance for
     testing goodwill for impairment and requires  additional  disclosures about
     goodwill and intangible assets.  SFAS No. 142 is effective for fiscal years
     beginning  after December 15, 2001.  SFAS No. 142 is required to be applied
     to the  beginning  of any  entity's  fiscal  year and to be  applied to all
     goodwill and other intangible assets recognized in its financial statements
     at  that  date.   Impairment  losses  for  goodwill  and   indefinite-lived
     intangible  assets  that  arise  due to the  initial  application  of  this
     Standard  are to be  reported  as  resulting  from a change  in  accounting
     principle.  Management  does not believe the  adoption of SFAS No. 142 will
     have a significant impact on its financial statements.

     In  June  2001,  Statement  on  Financial  Accounting  Standards  No.  143,
     "Accounting  for  Asset  Retirement  Obligations"  was  issued  to  address
     financial  reporting  and  obligations  associated  with the  retirement of
     tangible  long-lived assets and the associated asset retirement costs. This
     Statement applies to all entities and to legal obligations  associated with
     the  retirement  of  long-lived  assets that  result from the  acquisition,
     construction,  development  or normal  operations  of a  long-lived  asset,
     except for certain  obligations of lessees.  Statement No. 143 is effective
     for financial  statements  issued for fiscal years beginning after June 15,
     2002.  Management  does not believe the adoption of Statement  No. 143 will
     have a significant impact on its financial statements.

     In August  2001,  Statement  on  Financial  Accounting  Standards  No. 144,
     "Accounting for the Impairment or Disposal of Long-Lived Assets" was issued
     to supersede  Statement No. 121,  "Accounting  for the  Impairment  and for
     Long-Lived  Assets to Be Disposed  Of", and the  accounting  and  reporting
     provisions  of APB Opinion No. 30,  "Reporting  the Results of Operations -
     Reporting  the  Effects  of  Disposal  of  a  Segment  of a  Business,  and
     Extraordinary, Unusual and Infrequently Occurring Events and Transactions".
     Statement No. 144 is effective for financial  statements  issued for fiscal
     years  beginning  after December 15, 2001, and interim periods within those
     fiscal  years,  with  early  application  encouraged.  Management  does not
     believe the adoption of Statement No. 144 will have a significant impact on
     its financial statements.

3.   Cash and Due from Banks

The  compensating  balances held at  correspondent  banks were  $74,947,000  and
$45,806,000 at December 31, 2001 and 2000, respectively. The Banks maintain such
compensating  balances with  correspondent  banks to offset charges for services
rendered by those  banks.  In addition,  the Banks were  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 $9,472,000 and $8,025,000
at December 31, 2001 and 2000, respectively.
<PAGE>

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, 2001
   U.S. Treasury and other
     government agencies .................................   $196,628   $  3,500     $    226     $199,902
   Mortgage-backed securities ............................     27,852        433            6       28,279
   Obligations of states and political subdivisions ......     15,380        293           31       15,642
   Other .................................................     22,408        959          694       22,673
                                                             ---------------------------------------------
                                                             $262,268   $  5,185     $    957     $266,496
                                                             =============================================

December 31, 2000
   U.S. Treasury and other
     government agencies .................................   $180,170   $    661     $    697     $180,134
   Mortgage-backed securities ............................     11,528         69           84       11,513
   Obligations of states and political subdivisions ......     15,087        289           27       15,349
   Other .................................................      5,990      1,480          780        6,690
                                                             ---------------------------------------------
                                                             $212,775   $  2,499     $  1,588     $213,686
                                                             =============================================

                                                                             Held-to-Maturity
                                                             ---------------------------------------------
                                                                          Gross        Gross
                                                             Amortized  Unrealized   Unrealized    Fair
                                                               Cost       Gains        Losses      Value
                                                             ---------------------------------------------
December 31, 2001
   U.S. Treasury and other
    government agencies ..................................   $  1,750   $     66     $     --     $  1,816
   Obligations of states and political subdivisions ......     42,226        735           51       42,910
   Mortgage-backed securities ............................     19,842        179           20       20,001
                                                             ---------------------------------------------
                                                             $ 63,818   $    980     $     71     $ 64,727
                                                             =============================================
December 31, 2000
   U.S. Treasury and other
     government agencies .................................   $ 29,428   $     16     $    175     $ 29,269
   Obligations of states and political subdivisions ......     32,902        320          129       33,093
   Mortgage-backed securities ............................     22,642         10          165       22,487
                                                             ---------------------------------------------
                                                             $ 84,972   $    346     $    469     $ 84,849
                                                             =============================================
</TABLE>
A summary of other equity  securities  (in  thousands)  at December 31, 2001 and
2000 is as follows:

                                                             2001          2000
                                                            --------------------
Federal Home Loan Bank Stock, at cost ..............        $3,535        $3,295

Federal Reserve Bank Stock, at cost ................           231           231
Other investments, at fair value ...................         1,342         1,003
                                                            --------------------
                                                            $5,108        $4,529
                                                            ====================

Realized  gains and losses (in  thousands) on sales and maturities for the years
ended December 31, 2001, 2000 and 1999 were as follows:

                                                    2001      2000      1999
                                                   --------------------------
Gross gains ..............................         $  563    $  320    $  223
Gross losses .............................           (453)     (299)      (82)
                                                   --------------------------
Net gains ................................         $  110    $   21    $  141
                                                   ==========================
Applicable income taxes ..................         $   39    $    7    $   49
                                                   ==========================
<PAGE>

Investments in debt and equity  securities with a carrying value of $217,369,000
and $192,580,000  were pledged at December 31, 2001 and 2000,  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 equity  securities
(in thousands) at December 31, 2001, by contractual  maturity,  are shown below.
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.
Therefore,  these securities and equity securities with no stated maturities are
not included in the following maturity summary.

                                       Available-for-Sale      Held-to-Maturity
                                       -------------------   -------------------
                                       Amortized    Fair     Amortized    Fair
                                         Cost      Value       Cost       Value
                                       -----------------------------------------
Due in one year or less .............. $ 33,901   $ 34,544   $  2,448   $  2,476
Due after one year through five years   170,475    173,247     33,635     34,187
Due after five years through ten years    8,158      8,311      7,893      8,063
Due after ten years ..................    2,515      2,541         --         --
                                       -----------------------------------------
                                       $215,049   $218,643   $ 43,976   $ 44,726
Mortgage-backed securities ...........   27,852     28,279     19,842     20,001
Marketable equity securities .........   19,367     19,574         --         --
Other equity securities ..............    5,138      5,108         --         --
                                       -----------------------------------------
              Total debt securities .. $267,406   $271,604   $ 63,818   $ 64,727
                                       =========================================

5. Loans

A summary of loans (in thousands),  by classification,  at December 31, 2001 and
2000 is as follows:
                                                           2001           2000
                                                         -----------------------

Commercial, financial, and agricultural ..........       $246,042       $219,541
Real estate ......................................        316,693        319,412
Installment and consumer .........................        119,585        129,775
                                                         -----------------------
                                                         $682,320       $668,728
Less:
   Allowance for loan losses .....................          9,259          8,879
                                                         -----------------------
                                                         $673,061       $659,849
                                                         =======================

The Company makes  commercial,  financial,  and agricultural;  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.

During  2001,  2000 and  1999,  the  Company  sold  approximately  $104,155,000,
$25,537,000 and $59,886,000,  respectively, of residential mortgage loans in the
secondary  market,  primarily to Fannie Mae and Bank of America.  Gross gains of
approximately $856,000, $228,000 and $562,000, and gross losses of approximately
$28,000,  $16,000 and $35,000,  were realized on the sales during 2001, 2000 and
1999, respectively.

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, 2001, 2000 and 1999:

                                                    2001       2000       1999
                                                  ------------------------------

Fannie Mae .................................      $107,950   $111,060   $122,887
Freddie Mac ................................         4,216      1,051      1,432
Illinois Housing Development Authority .....         2,288      2,759      2,605
<PAGE>

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 2001 was as follows:

                                                                         2001
                                                                       --------

Balance, January 1 .....................................               $ 24,691
New loans ..............................................                 23,416
Repayments .............................................                (15,637)
                                                                       --------
Balance, December 31 ...................................               $ 32,470
                                                                       ========

At  December  31,  2001,  one to four  family  real  estate  mortgage  loans  of
approximately $124,638,000 were pledged to secure advances from the Federal Home
Loan Bank.

Activity in the allowance for loan losses (in thousands) for 2001, 2000 and 1999
was as follows:

                                                     2001       2000      1999
                                                    ----------------------------

Balance, beginning of year ......................   $8,879     $8,682    $8,852
Provision charged to expense ....................    2,670        804       573
Loans charged off ...............................   (2,673)    (1,252)   (1,256)
Recoveries on loans previously charged off ......      383        645       513
                                                    ----------------------------
Balance, end of year ............................   $9,259     $8,879    $8,682
                                                    ============================

The following table presents summary data on nonaccrual and other impaired loans
(in thousands) at December 31, 2001, 2000 and 1999:

                                                       2001     2000      1999
                                                    ----------------------------

Impaired loans on nonaccrual ....................   $   125   $    97    $    --
Impaired loans continuing to accrue interest ....        --        --         --
                                                    ----------------------------
Total impaired loans ............................   $   125   $    97    $    --
                                                    ============================
Other non-accrual loans not classified
    as impaired .................................   $ 3,216   $   505    $   112
                                                    ============================

Allowance for loan losses on impaired loans .....   $    19   $    15    $    --
                                                    ============================
Impaired loans for which there is no related
    allowance for loan losses ...................   $    --   $    --    $    --
                                                    ============================
Average recorded investment in impaired
    loans .......................................   $   142   $    19    $   217
                                                    ============================
Interest income recognized from impaired
    loans .......................................   $    --   $    --    $    --
                                                    ============================
Cash basis interest income recognized from
    impaired loans ..............................   $     5   $    --    $    97
                                                    ============================
<PAGE>

6. Premises and Equipment

A summary of premises and equipment (in thousands) at December 31, 2001 and 2000
is as follows:

                                                              2001        2000
                                                             -------------------
Land ...................................................     $ 4,783     $ 4,835
Furniture and equipment ................................      14,119      15,024
Buildings and leasehold improvements ...................      22,669      22,679
                                                             -------------------
                                                              41,571      42,538
Less accumulated depreciation and amortization .........      22,312      21,664
                                                             -------------------
                                                             $19,259     $20,874
                                                             ===================

Depreciation and amortization expense was $2,731,000,  $2,813,000 and $2,672,000
for 2001, 2000 and 1999, respectively.

The  Company  leases   various   operating   facilities   and  equipment   under
noncancellable  operating  lease  arrangements.  These leases  expire at various
dates through  November 2007 and have renewal  options to extend the lease terms
for various dates through  November 2017. The rental expense for these operating
leases was $239,000, $202,000 and $209,000 in 2001, 2000 and 1999, 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, 2001 are as follows:

2002                                                      $    232
2003                                                           124
2004                                                           108
2005                                                            52
2006                                                            44
Thereafter                                                      26
                                                          --------
                                                          $    586
                                                          ========

7. Deposits

As of  December  31,  2001,  the  scheduled  maturities  of  time  deposits  (in
thousands) were as follows:

2002                                                            $253,111
2003                                                              83,904
2004                                                              26,604
2005                                                               5,770
2006                                                               2,235
                                                                --------
                                                                $371,624
                                                                ========

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

A summary of short-term  borrowings (in thousands) at December 31, 2001 and 2000
is as follows:

                                                                 2001      2000
                                                               -----------------
Federal funds purchased ....................................   $ 5,725   $ 2,375
U.S. Treasury demand notes .................................     2,201     4,569
Securities sold under agreements to repurchase:
  U.S. Treasury and other government agency securities
    with carrying values of $98,968,509 and $88,513,000
    and market values of $99,158,612 and $88,210,000
    at December 31, 2001 and 2000, respectively ............    77,281    62,714
                                                               -----------------
                                                               $85,207   $69,658
                                                               =================
<PAGE>

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

                                                     2001      2000       1999
                                                   -----------------------------
Federal funds purchased:
   Average daily balance .......................   $ 4,629    $ 3,549    $ 9,417
   Maximum balance at month-end ................   $12,090    $11,860    $30,300
   Weighted average interest rate at year-end ..     1.29%      5.13%      3.91%
   Weighted average interest rate for the year..     4.36%      4.95%      4.79%

Securities sold under agreements to repurchase:
   Average daily balance .......................   $68,061    $64,173    $62,844
   Maximum balance at month-end ................   $77,281    $80,787    $79,065
   Weighted average interest rate at year-end ..     2.27%      5.32%      5.90%
   Weighted average interest rate for the year .     3.32%      5.28%      4.24%

U.S. Treasury demand notes
   Average daily balance .......................   $ 2,228    $ 2,588    $ 2,401
   Maximum Balance at month-end ................   $ 5,186    $ 5,330    $ 5,490
   Weighted average interest rate at year-end ..     2.70%      6.28%      4.49%
   Weighted average interest rate for the year .     4.12%      6.29%      4.46%

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

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, 2001 is as follows:

                                                   December 31
                             ---------------------------------------------------
                                                 2001                     2000
                             ---------------------------------------------------
                                                             Weighted
                               FHLB        Other              Average
                             Advances    Borrowings   Total     Rate      Total
                             ---------------------------------------------------
Maturing in year ending:
   2001                      $     --      $    --   $    --       -     $11,023
   2002                         7,000           23     7,023    6.09%      7,023
   2003                            --           23        23    8.50%         23
   2004                            --           23        23    8.50%         23
   2005                            --           23        23    8.50%         23
   2006                         5,000           23     5,023    5.69%         23
   2007                         2,734           23     2,757    6.85%      2,817
   2008                        20,000           23    20,023    5.27%     20,023
                              --------------------------------------------------
                              $34,734      $   161   $34,895    5.63%    $40,978
                              ==================================================

The terms of a security  agreement  with the FHLB require the Banks 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. The Banks had a
total remaining borrowing capacity with the FHLB of approximately $35,975,000 at
December 31, 2001 at a rate equal to the FHLB current advance rates.

The  other  borrowings  were  for the  purchase  of land at a cost of  $266,000.
Principal of $23,000 and annual interest is 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 the previous year. The rate at December 31, 2001 was 8.50%.

10. Line of Credit

The Company has an  unsecured  line of credit of  $5,000,000  from a third party
lender. As of December 31, 2001, the entire line was available.

11.  Income Taxes

Federal income tax expense (in thousands) for 2001,  2000 and 1999 is summarized
as follows:

                                                      2001     2000       1999
                                                    ----------------------------

Current .......................                     $ 9,379   $ 6,452   $ 6,140
Deferred ......................                      (1,643)      (26)     (975)
                                                    ----------------------------
Total .........................                     $ 7,736   $ 6,426   $ 5,165
                                                    ============================
<PAGE>

Actual income tax expense (in thousands) for 2001, 2000 and 1999 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:

                                                 2001        2000         1999
                                               ---------------------------------

Computed "expected" income taxes .........     $ 8,367      $ 6,445     $ 5,899
Tax-exempt interest income, net of
  disallowed interest expense ............        (718)        (646)       (624)
Nondeductible merger expenses ............          --          509          --
Income taxed at lower rates ..............          --           --        (169)
Other, net ...............................          87          118          59
                                               ---------------------------------
                                               $ 7,736      $ 6,426     $ 5,165
                                               =================================

The tax  effects  of  temporary  differences  (in  thousands)  that give rise to
significant  portions of the deferred tax assets and deferred tax liabilities at
December 31, 2001 and 2000 are as follows:

                                                              2001       2000
                                                             ------------------
Deferred tax assets:
  Allowance for loan losses ..............................   $ 3,102    $ 2,723
  Deferred compensation ..................................     1,631      1,407
  Stock appreciation rights ..............................        85        110
  Other employee benefits ................................       133         54
  Severance payable ......................................        15         48
  Other ..................................................        37        100
                                                             ------------------
        Total deferred tax assets ........................   $ 5,003    $ 4,442
                                                             ------------------
Deferred tax liabilities:
  Unrealized holding gain on available-for-sale securities   $(1,442)   $  (309)
  Premises and equipment .................................    (1,124)    (1,520)
  Mortgage servicing rights ..............................      (229)      (171)
  Deferred loan fees .....................................      (104)      (112)
  Discount accretion .....................................      (161)      (107)
  Other ..................................................      (370)      (869)
                                                             ------------------
        Total deferred tax liabilities ...................   $(3,430)   $(3,088)
                                                             ------------------
Valuation allowance ......................................        --       (287)
                                                             ------------------
         Net deferred tax assets .........................   $ 1,573    $ 1,067
                                                             ==================

A  valuation  allowance  is  provided  when it is more likely than not that some
portion of the deferred tax assets will not be realized.

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 allows for  participants'  contributions of up to 15% of gross salary,  the
first 6% of which is 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.  Total  contributions  by the Company  totaled
$746,000, $928,000 and $717,000 for 2001, 2000 and 1999, respectively.

Effective  December 31, 1999, the Company  terminated  the defined  benefit plan
that  covered  substantially  all of the  employees  of First  National  Bank of
Decatur, FirsTech, Inc. and First Trust Bank of Shelbyville.  As a result of the
termination of the Plan, the Company  recorded an estimated  settlement  loss of
$2,139,000, recorded a gain on curtailment of $1,587,000 and reduced the related
prepaid  pension  asset in  accordance  with  Statement of Financial  Accounting
Standards No. 88,  Employers'  Accounting for  Settlements  and  Curtailments of
Defined Benefit Pension Plans and for Termination of Benefits.

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,   $280,000   and  $260,000  in  2001,   2000  and  1999,
respectively, related to these agreements.
<PAGE>

The Company has a deferred  compensation  plan for nonemployee  directors of the
Company in which a participating  director may defer  directors' fees in a fixed
income  fund  or,  alternatively,  in the form of  "phantom  stock  units."  For
directors  electing to receive phantom stock, a deferred  compensation  account,
included in other  liabilities on the  consolidated  balance sheet,  is credited
with  phantom  stock units.  Phantom  stock units shall also be increased by any
stock  dividends or stock splits  declared by the Company.  At December 31, 2001
and  2000,  $285,894  and  $276,579  had been  deferred  from this  plan,  which
represented 22,746 and 22,205 phantom stock units.

13. Stock Options and Related Plans

The Company has  established  a stock  incentive  plan,  which  provides for the
granting of both  qualified and  non-qualified  options of the Company's  common
stock to  certain  key  managerial  employees,  and a stock  option  plan  which
provides for the granting of non-qualified  stock options and stock appreciation
rights (SARs) to certain key managerial  employees.  The option price must be at
least 100% of the fair market  value of the common  stock on the date the option
is granted and the maximum  option term cannot exceed 10 years.  The plan allows
for the granting of options in tandem with SARs.  Exercise of an SAR cancels the
related option and entitles the holder to receive a payment in return,  equal to
the  excess  of the  fair  market  value of the  shares  subject  to the  option
surrendered  over the  exercise  price.  Payment by the Company  will be made in
shares of the  Company's  common  stock  with  cash  paid in lieu of  fractional
shares.  The exercise of an SAR is subject to all of the terms and conditions of
the related option. All of these options are fully vested.

In 1996, 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,  which vest and thus become  exercisable  ratably over a
three-year  period from the date  granted.  All options  granted  subsequent  to
January 1, 1996 were issued from the 1996 plan.

As a result of the merger,  all options granted under the previous plans vested.
In 2000, 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.  Director  options  vest,  and thus become  exercisable,
immediately   while  officer  and  employee   options  vest,   and  thus  become
exercisable, ratably over a three-year period from the date granted.

The Company has an employee  stock option plan (Plan) which is accounted  for in
accordance with Accounting Principles Board Opinion No. 25, Accounting for Stock
Issued to Employees,  and  accordingly,  no  compensation  expense for the stock
option grants has been recognized.  Under this Plan, the Company grants selected
key officers stock option awards,  which vest and become fully exercisable after
the fifth anniversary of the date of the grant. Stock options granted under this
Plan shall expire ten years from the date of grant. At December 31, 2001,  there
were options outstanding (not intended to be incentive stock options) for 31,147
shares.  These options were granted on December 31, 1993, with an exercise price
of $9.24  per  share and have a  remaining  contractual  life of two years as of
December 31, 2001. During 1999, all 31,147 shares became vested and exercisable.
No shares have been exercised pursuant to the Plan.

The following is a summary of the changes in options outstanding under the stock
incentive and stock option plans:
<TABLE>
                                      2001                        2000                        1999
                              --------------------------------------------------------------------------------
                                             Grant                      Grant                        Grant
                                             Price                      Price                        Price
                              Shares         Range        Shares        Range         Shares         Range
                              --------------------------------------------------------------------------------
<S>                           <C>       <C>               <C>       <C>               <C>       <C>
Options outstanding,
  beginning of year .......   726,273   $ 5.36 - $19.76   604,810   $ 5.36 - $19.76    533,360   $ 5.36 - $16.86
Granted ...................   169,050   $17.50 - $17.50   133,383   $18.37 - $18.30     87,955   $19.76 - $19.76
Exercised .................   (17,360)  $ 5.36 - $12.05    (6,827)  $ 5.36 - $16.86    (13,071)  $ 5.36 - $19.76
Options forfeited .........    (8,965)  $16.86 - $19.76    (5,093)  $12.05 - $19.70     (3,434)  $12.05 - $19.76
                              ----------------------------------------------------------------------------------
Options outstanding,
  end of year .............   868,998   $ 5.36 - $19.76   726,273   $ 5.36 - $19.76    604,810   $ 5.36 - $19.76
                              ==================================================================================
Options exercisable,
  end of year .............   784,769   $ 5.36 - $19.76   687,778   $ 5.36 - $19.76    541,746   $ 5.36 - $19.76
                              ==================================================================================
Weighted average fair value
  of options granted ......                      $ 3.73                       $ 2.20                      $ 3.79
                              ===================================================================================
</TABLE>
<PAGE>


                   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       2001       Life           Price         2001        Price
--------------------------------------------------------------------------------

$ 0.00 - $ 5.93      280,428        2.0       $  5.36      280,428     $  5.36
$ 5.93 - $ 7.90       27,200        3.0          6.92       27,200        6.92
$ 7.90 - $ 9.88       31,147        2.0          9.24       31,147        9.24
$11.86 - $13.83       69,491        0.2         12.20       69,491       12.20
$15.81 - $17.78      247,877        6.5         17.28      184,291       17.21
$17.78 - $19.76      212,855        5.9         18.91      192,212       18.96
                     -----------------------------------------------------------
                     868,998        4.1       $ 12.81      784,769     $ 12.29
                     ===========================================================

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.

                                          2001             2000          1999
                                         ---------------------------------------

Number of options granted .......        169,050         133,383         87,955
Risk-free interest rate .........          5.05%           5.14%          6.06%
Expected life, in years .........           6.97            8.80           3.46
Expected volatility .............         14.10%          11.06%          7.79%
Expected dividend yield .........          2.23%           2.39%          1.41%

Grants  under the stock  incentive  and stock  option  plans are  accounted  for
following  APB  Opinion  No. 25 and  related  interpretations.  Accordingly,  no
compensation  cost has been  recognized for incentive  stock option grants under
the plans. Had compensation cost for all of the stock-based  compensation  plans
been  determined  based on the fair values of awards (the  method  described  by
Statement No. 123), on the grant date,  reported  income and earnings per common
share would have been reduced to the pro forma amounts shown below:

                                           2001           2000            1999
                                        ----------------------------------------

Net income on common stock:
   As reported ....................     $   16,171     $   11,989     $   11,688
   Pro forma ......................         15,878         11,743         11,453
Basic earnings per share:
   As reported ....................     $     1.48     $     1.08     $     1.05
   Pro forma ......................           1.45           1.06           1.03
Diluted earnings per share:
   As reported ....................     $     1.45     $     1.06     $     1.03
   Pro forma ......................           1.43           1.04           1.01

At December 31, 2001, 10,212 SAR's remained outstanding.

14. Dividend Restrictions

Without prior approval of the  Comptroller of the Currency,  First National Bank
of Decatur is  restricted by national  banking laws as to the maximum  amount of
dividends it can pay in any calendar  year to First  National  Bank of Decatur's
retained net profits (as defined) for that year and the two preceding  years. At
December  31,  2001,  First  National  Bank of Decatur  had  available  retained
earnings  of  approximately  $11,087,000  for the payment of  dividends  without
obtaining prior regulatory approval.

Without prior  approval,  BankIllinois  and First Trust Bank of Shelbyville  are
restricted  by  Illinois  law and  regulations  of the  Office of Banks and Real
Estate, State of Illinois,  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, 2001,
BankIllinois and First Trust Bank of Shelbyville had available retained earnings
of  approximately  $35,989,000 and $9,405,000  respectively,  for the payment of
dividends without obtaining prior regulatory approval.
<PAGE>

15. Condensed Financial Information of Parent Company

Following are the condensed  balance sheets as of December 31, 2001 and 2000 and
the related  condensed  statements  of income and cash flows for the years ended
December 31, 2001, 2000 and 1999 for Main Street Trust, Inc.:

                            Condensed Balance Sheets
                            ------------------------
                                 (in thousands)
                                                           2001          2000
                                                         -----------------------
Assets:
  Cash ...........................................       $  5,411       $  1,587
  Investment in banks ............................        117,550        112,482
  Investment in FirsTech .........................          7,065          6,242
  Investment in other securities .................          6,708          7,255
  Other assets ...................................          2,384          2,752
                                                         -----------------------
                                                         $139,118       $130,318
                                                         =======================
Liabilities and shareholders' equity:
  Dividends payable ..............................       $  1,452       $  1,047
  Other liabilities ..............................          1,673          3,869
  Shareholders' equity ...........................        135,993        125,402
                                                         -----------------------
                                                         $139,118       $130,318
                                                        =======================

                         Condensed Statements of Income
                                 (in thousands)

                                                     2001       2000       1999
                                                   -----------------------------
Revenue:
  Dividends received from subsidiaries .........  $ 12,000   $  5,359   $ 8,438
  Interest income on deposits ..................        39         87       100
  Income on securities .........................        72         85        80
  Securities transactions, net .................      (279)        42        (9)
  Other ........................................       131        132       135
                                                  ------------------------------
       Total revenue ...........................    11,963      5,705     8,744
                                                  ------------------------------
Expenses:
  Reconciliation liability .....................    (2,500)        --     2,500
  Merger related professional fees .............        --      2,544        --
  Termination of pension plan and benefit costs         --         --       743
  Other ........................................     1,055      2,285       615
                                                  ------------------------------
       Total expense ...........................    (1,455)     4,829     3,858
                                                  ------------------------------
       Income before applicable income tax
       expense (benefit) and equity in
       undistributed income or subsidiaries ....    13,408        876     4,886
Applicable income tax expense (benefit) ........       591       (754)   (1,207)
Equity in undistributed income of subsidiaries .     3,354     10,359     5,595
                                                  ------------------------------
       Net income ..............................  $ 16,171   $ 11,989  $ 11,688
                                                  ==============================
<PAGE>


                       Condensed Statements of Cash Flows
                                 (in thousands)
<TABLE>

                                                         2001        2000        1999
                                                       --------------------------------
<S>                                                    <C>         <C>         <C>
Cash flows from operating activities:
    Net income .....................................   $ 16,171    $ 11,989    $ 11,688
    Adjustments to reconcile net income to net cash
      provided by operating activities:
      Equity in undistributed income of Subsidiaries     (3,354)    (10,359)     (5,595)
      Depreciation .................................         30          24          24
      Other, net ...................................     (1,649)        964         288
                                                       --------------------------------
            Net cash provided by operating activities    11,198       2,618       6,405
                                                       --------------------------------

Cash flows from investing activities:
    Equity securities transactions, net ............        (37)     (2,508)     (1,031)
    Other, net .....................................        (12)         27          --
                                                       --------------------------------
            Net cash used in investing activities ..        (49)     (2,481)     (1,031)
                                                       --------------------------------
Cash flows from financing activities:
    Treasury stock transactions, net ...............     (2,802)     (2,057)         --
    Fractional shares purchased following stock
      dividend and merger ..........................         (6)        (11)         (5)
    Cash dividends paid ............................     (4,540)     (3,869)     (3,176)
    Other, net .....................................         23          37          --
                                                       --------------------------------
            Net cash used in financing activities ..     (7,325)     (5,900)     (3,181)
                                                       --------------------------------
Cash at beginning of year ..........................      1,587       7,350       5,157
                                                       --------------------------------
Cash at end of year ................................   $  5,411    $  1,587    $  7,350
                                                       ================================
</TABLE>


16. Quarterly Results of Operations (Unaudited) (in thousands,  except per share
    data)
<TABLE>
                                                   Year Ended December 31, 2001
                                                       Three Months Ended
                                         ----------------------------------------------
                                         December 31  September 30   June 30   March 31
                                         ----------------------------------------------
<S>                                      <C>          <C>            <C>       <C>
Interest income ........................   $17,278       $18,040     $18,756   $19,121
Interest expense .......................     6,868         8,305       8,846     9,579
                                           -------------------------------------------
        Net interest income ............    10,410         9,735       9,910     9,542
Provision for losses on loans ..........     1,825           235         375       235
                                           -------------------------------------------
        Net interest income after
        provision for losses
        on loans .......................     8,585        9,500       9,535     9,307
Non-interest income ....................     4,420        4,332       4,262     4,087
Non-interest expense ...................     6,328        7,804       7,923     8,066
                                           ------------------------------------------
        Income before income taxes .....     6,677        6,028       5,874     5,328
Income taxes ...........................     2,282        1,984       1,810     1,660
                                           ------------------------------------------

        Net income .....................   $ 4,395      $ 4,044     $ 4,064   $ 3,668
                                           ==========================================

Basic earnings per share ...............   $  0.40       $  0.37    $  0.37   $  0.34
                                           ==========================================

Diluted earnings per share .............   $  0.40       $  0.36    $  0.36   $  0.33
                                           ==========================================
</TABLE>
<PAGE>

<TABLE>

                                                      Year Ended December 31, 2000
                                                           Three Months Ended
                                            ----------------------------------------------
                                            December 31  September 30   June 30   March 31
                                            ----------------------------------------------
<S>                                         <C>          <C>            <C>       <C>
Interest income ...........................   $19,489      $18,878      $18,030   $17,874
Interest expense ..........................     9,945        9,525        8,589     8,540
                                              -------------------------------------------
          Net interest income .............     9,544        9,353        9,441     9,334
Provision for losses on loans .............       346          191          131       136
                                              -------------------------------------------
          Net interest income after
               provision for losses
               on loans ...................     9,198        9,162        9,310     9,198
Non-interest income .......................     3,876        3,977        4,064     4,319
Non-interest expense ......................     7,959        7,989        7,643    11,098
                                              -------------------------------------------
          Income before income taxes ......     5,115        5,150        5,731     2,419
Income taxes ..............................     1,581        1,606        1,814     1,425
                                              -------------------------------------------
         Net income .......................   $ 3,534      $ 3,544      $ 3,917   $   994
                                              ===========================================

Basic earnings per share ..................   $  0.32      $  0.32      $  0.35   $  0.09
                                              ===========================================

Diluted earnings per share ................   $  0.31      $  0.31      $  0.35   $  0.09
                                              ===========================================
</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.

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, 2001 and 2000:

                                                        2001              2000
                                                      --------------------------
Financial instruments whose contract amounts
  represent credit risk:
  Commitments ..............................          $173,705          $132,163
  Standby letters of credit ................             3,540             4,093

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 is $1.75
million to purchase other equity securities.
<PAGE>

Standby letters of credit are conditional  commitments  issued by the Company to
guarantee  the  performance  of a customer  to a third  party.  The credit  risk
involved in issuing  letters of credit is essentially  the same as that involved
in extending loans to customers. The standby letters of credit are unsecured.

The Company does not engage in the use of interest rate swaps, futures, forwards
or options contracts.

During 1999, the Company investigated reconciliation differences, which involved
the  Company's  subsidiary,  FirsTech,  Inc. in connection  with its  commercial
remittance  processing  services.   After  consultation  with  its  professional
advisors,  the  Company's  Board of Directors  directed  that a liability in the
amount of $2.5 million be recorded in the fourth quarter of 1999.  Investigation
of these  differences  was completed  during the fourth  quarter of 2001. It was
determined that no liability existed and the $2.5 million liability was reversed
in non-interest expense.

Following is a summary of the carrying  amounts and fair values of the Company's
financial instruments at December 31, 2001 and 2000:
<TABLE>
                                                      2001                   2000
                                               -------------------   -------------------
                                               Carrying    Fair      Carrying     Fair
                                                Amount     Value      Amount      Value
                                               -----------------------------------------
<S>                                            <C>        <C>        <C>        <C>
Assets:
   Cash and cash equivalents ...............   $ 95,379   $ 95,379   $ 84,139   $ 84,139
   Investments in debt and equity securities    335,422    336,331    303,187    303,064
   Mortgage loans held for sale ............      8,775      8,775      2,090      2,090
   Loans ...................................    673,061    705,391    659,849    678,678
   Accrued interest receivable .............      8,890      8,890     10,629     10,629
Liabilities:
   Deposits ................................   $884,109   $885,208   $839,932   $842,984
   Federal funds, repurchase agreements,
        and notes payable ..................     85,207     83,076     69,658     70,338
   FHLB advances and other borrowings ......     34,895     39,337     40,978     40,924
   Accrued interest payable ................      3,390      3,390      4,584      4,584
</TABLE>

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.

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, 2001 and 2000.  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.
<PAGE>

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 fair value of federal  funds  purchased,  repurchase  agreements,  and notes
payable is based on the discounted value of contractual cash flows. The discount
rate is estimated  using current rates on federal  funds  purchased,  repurchase
agreements, and notes payable with 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.

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 banks 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  banks'  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 banks' capital amounts and  classification are also
subject to  qualitative  judgments  by the  regulators  about  components,  risk
weightings, and other factors.
<PAGE>

Quantitative  measures  established  by  regulation to ensure  capital  adequacy
require the Company and its  subsidiary  banks 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,
2001,  that the Company and its subsidiary  banks exceeded all capital  adequacy
requirements to which they are subject.

As of December 31, 2001, the most recent  notifications  from primary regulatory
agencies  categorized  all the Company's  subsidiary  banks 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 banks' categories.

The Company's and the Banks'  actual  capital  amounts and ratios as of December
31, 2001 and 2000 are presented in the following tables:
<TABLE>
                                                                                To Be Well
                                                                             Capitalized Under
                                                             For Capital     Prompt Corrective
                                             Actual       Adequacy Purposes  Action Provisions
                                        ------------------------------------------------------
                                         Amount   Ratio     Amount   Ratio    Amount     Ratio
                                        ------------------------------------------------------
<S>                                     <C>       <C>      <C>       <C>     <C>         <C>
As of December 31, 2001:
 Total capital
   (to risk-weighted assets)
   Consolidated .....................   $142,403   18.0%   $ 63,212   8.0%        N/A
   BankIllinois .....................   $ 65,208   14.9%   $ 34,908   8.0%   $ 43,634    10.0%
   First National Bank of Decatur ...   $ 47,672   16.3%   $ 23,363   8.0%   $ 29,204    10.0%
   First Trust Bank of Shelbyville ..   $ 11,084   22.6%   $  3,926   8.0%   $  4,907    10.0%
 Tier I capital
   (to risk-weighted assets)
   Consolidated .....................   $133,053   16.8%   $ 31,606   4.0%        N/A
   BankIllinois .....................   $ 59,983   13.8%   $ 17,454   4.0%   $ 26,181     6.0%
   First National Bank of Decatur ...   $ 44,083   15.1%   $ 11,681   4.0%   $ 17,522     6.0%
   First Trust Bank of Shelbyville ..   $ 10,531   21.5%   $  1,963   4.0%   $  2,944     6.0%
 Tier I capital
   (to average assets)
   Consolidated .....................   $133,053   11.8%   $ 44,950   4.0%        N/A
   BankIllinois .....................   $ 59,983    9.9%   $ 24,200   4.0%   $ 30,250     5.0%
   First National Bank of Decatur ...   $ 44,083   10.2%   $ 17,274   4.0%   $ 21,592     5.0%
   First Trust Bank of Shelbyville ..   $ 10,531   13.3%   $  3,166   4.0%   $  3,957     5.0%

As of December 31, 2000:
 Total capital
   (to risk-weighted assets)
   Consolidated .....................   $133,352   18.6%   $ 57,224   8.0%        N/A    10.0%
   BankIllinois .....................   $ 64,777   16.1%   $ 32,125   8.0%   $ 40,156    10.0%
   First National Bank of Decatur ...   $ 43,886   16.0%   $ 21,996   8.0%   $ 27,495    10.0%
   First Trust Bank of Shelbyville ..   $ 12,194   29.2%   $  3,339   8.0%   $  4,174    10.0%
 Tier I capital
   (to risk-weighted assets)
   Consolidated .....................   $124,474   17.4%   $ 28,612   4.0%        N/A     6.0%
   BankIllinois .....................   $ 59,698   14.9%   $ 16,062   4.0%   $ 24,093     6.0%
   First National Bank of Decatur ...   $ 40,449   14.7%   $ 10,998   4.0%   $ 16,497     6.0%
   First Trust Bank of Shelbyville ..   $ 11,869   28.4%   $  1,669   4.0%   $  2,504     6.0%
 Tier I capital
   (to average assets)
   Consolidated .....................   $124,474   11.6%   $ 42,982   4.0%        N/A     5.0%
   BankIllinois .....................   $ 59,698   10.7%   $ 22,403   4.0%   $ 28,004     5.0%
   First National Bank of Decatur ...   $ 40,449    9.5%   $ 16,952   4.0%   $ 21,190     5.0%
   First Trust Bank of Shelbyville ..   $ 11,869   16.3%   $  2,907   4.0%   $  3,634     5.0%
</TABLE>
<PAGE>
Item 9.  Changes in and Disagreements on Accounting and Financial Disclosure

None.

                                    PART III

Item 10. Directors and Executive Officers of the Registrant

The  information  in the  Company's  2002  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 2002 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 2002 Proxy Statement,  the names
and ages of the  executive  officers of the Company as of December 31, 2001,  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.

Name                        Position with Main Street, its subsidiaries
(Age)                       and occupation for the last five years
--------------              ----------------------------------------------------
David B. White              Executive Vice President and Chief Financial
(Age 50)                    Officer of Main Street, BankIllinois, The First
                            National Bank of Decatur, and First Trust Bank of
                            Shelbyville and Director of FirsTech;  Executive
                            Vice President and Chief Financial Officer of
                            BankIllinois Financial and BankIllinois (1993-2000)

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, if appropriate, representations made by any reporting
person concerning whether a Form 5 was required to be filed for 2001, we are not
aware of any failures to comply with the filing  requirements  of Section  16(a)
during 2001,  except for Mr. Kenney,  who filed a Form 4 reporting a purchase of
5,000 shares five months late.

Item 11.  Executive Compensation

The  information  in the 2002  Proxy  Statement  under  the  caption  "Executive
Compensation"  is incorporated by reference,  with the exception of the sections
entitled   "Compensation   Committee  Report  on  Executive   Compensation"  and
"Shareholder  Return  Performance  Presentation",  which  are  not  included  by
reference herein.

Item 12.  Security Ownership Of Certain Beneficial Owners And Management

The  information  in the  2002  Proxy  Statement  under  the  caption  "Security
Ownership  of Certain  Beneficial  Owners and  Management"  is  incorporated  by
reference.

Item 13.  Certain Relationships And Related Transactions

The information in the 2002 Proxy Statement under the caption "Transactions with
Management" is incorporated by reference.
<PAGE>

                                     PART IV

Item 14.   Exhibits, Financial Statement Schedules, and Reports on Form 8-K

(a)(1)     Index to Financial Statements

See page 31.

(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)        Reports on Form 8-K

The  Company  did not file any  Current  Reports  on Form 8-K  during the fourth
quarter of 2001.

(c)        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.
<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 November 30,
                                            1999 (SEC File No. 33-91759)

     3.2       Bylaws                       Exhibit 3.2 to the Form S-4 filed
                                            with the Commission on November 30,
                                            1999 (SEC File No. 33-91759)

     4.1       Specimen common stock        Exhibit 4.1 to the Form 10-K filed
                                            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                                                   X
               and between the Company
               and Gregory B. Lykins

    10.2       Employment Agreement by                                                   X
               and between the Company
               and Van A. Dukeman

    10.3       Employment Agreement by      Exhibit 10.5 to the Registration
               and between the Company      Statement of 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                                                   X
               and between the Company,
               FirsTech, Inc. and Phillip
               C. Wise

    21.1       Subsidiaries of the                                                       X
               Registrant

    23.1       Consent of McGladrey &                                                    X
               Pullen, LLP

    23.2       Consent of BKD LLP                                                        X
</TABLE>
<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 28, 2002.

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 28, 2002.

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

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

/s/ Phillip C. Wise
-------------------------------------
Phillip C. Wise                            Executive Vice President 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

/s/ John W. Luttrell
-------------------------------------
John W. Luttrell                           Director


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

/s/ Gene A. Salmon
-------------------------------------
Gene A. Salmon                             Director

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

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

/s/ Roy V. VanBuskirk
-------------------------------------
Roy V. VanBuskirk                          Director

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