| DIVIDEND AND STOCK HISTORY |   |
|----------------------------|--------|
|                       |   |   |   |   |   |   |   |
|                  |   |   |   |   |   | Distribution Date of |   |
|                  |   | Cash Dividends |   |   |   | Dividends and |   |
|                  |   | Declared(1) |   | Stock Dividends |   | Exchanges |   |
| 1983                       |   | $ | 0.05 |   | - |   | - |   |
| 1984                       |   | $ | 0.06 |   | 4 for 1 Exchange(2) |   | January 2, 1984 |   |
| 1985                       |   | $ | 0.07 |   | - |   | - |   |
| 1986                       |   | $ | 0.09 |   | - |   | - |   |
| 1987                       |   | $ | 0.09 |   | 50% Stock Dividend |   | October 2, 1987 |   |
| 1988                       |   | $ | 0.10 |   | - |   | - |   |
| 1989                       |   | $ | 0.10 |   | - |   | - |   |
| 1990                       |   | $ | 0.11 |   | - |   | - |   |
| 1991                       |   | $ | 0.12 |   | - |   | - |   |
| 1992                       |   | $ | 0.12 |   | 100% Stock Dividend |   | September 10, 1992 |   |
| 1993                       |   | $ | 0.12 |   | 100% Stock Dividend |   | November 30, 1993 |   |
| 1994                       |   | $ | 0.13 |   | 10% Stock Dividend |   | September 9, 1994 |   |
| 1995                       |   | $ | 0.19 |   | - |   | - |   |
| 1996                       |   | $ | 0.20 |   | 10% Stock Dividend |   | June 20, 1996 |   |
| 1997                       |   | $ | 0.23 |   | 10% Stock Dividend |   | September 19, 1997 |   |
| 1998                       |   | $ | 0.26 |   | 5% Stock Dividend |   | December 18, 1998 |   |
| 1999                       |   | $ | 0.30 |   | 5% Stock Dividend |   | December 20, 1999 |   |
| 2000                       |   | $ | 0.31 |   | 5% Stock Dividend |   | December 20, 2000 |   |
| 2001                       |   | $ | 0.32 |   | 5% Stock Dividend |   | December 20, 2001 |   |
| 2002                       |   | $ | 0.33 |   | 5% Stock Dividend |   | December 20, 2002 |   |
| 2003                       |   | $ | 0.35 |   | 10% Stock Dividend |   | December 19, 2003 |   |
| 2004                       |   | $ | 0.39 |   | 10% Stock Dividend |   | December 20, 2004 |   |
| 2005                       |   | $ | 0.43 |   | 10% Stock Dividend |   | December 20, 2005 |   |
| 2006                       |   | $ | 0.48 |   | 10% Stock Dividend |   | December 20, 2006 |   |
| 2007                       |   | $ | 0.52 |   | – |   | – |   |
| 2008                       |   | $ | 0.54 |   | – |   | – |   |
| 2009                       |   | $ | 0.56 |   | – |   | – |   |
| 2010                       |   | $ | 0.56 |   | – |   | – |   |

| (1) | Adjusted for stock dividends and exchanges. Does not include dividends from Southern Ohio Community Bancorporation, Inc. prior to the merger. |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------|

| (2) | Formation of United Bancorp, Inc. (UBCP). The Citizens Savings Bank shareholders received 4 shares of UBCP stock in exchange for 1 share of The Citizens Savings Bank. |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| Index                      |   | 12/31/05 |   |   | 12/31/06 |   |   | 12/31/07 |   |   | 12/31/08 |   |   | 12/31/09 |   |   | 12/31/10 |   |
|----------------------------|--------|----------|--------|--------|----------|--------|--------|----------|--------|--------|----------|--------|--------|----------|--------|--------|----------|--------|
| United Bancorp, Inc.       |   |     | 100.00 |   |     |   | 94.40  |     |   |   | 104.27   |   |   |     | 105.21 |   |     |   | 96.09 |   |   |   | 104.93 |   |
| NASDAQ Composite           |   |     | 100.00 |   |     |   | 110.39 |     |   |   | 122.15   |   |   |     | 73.32  |   |     |   | 106.57 |   |   |   | 125.91 |   |
| SNL Bank Index             |   |     | 100.00 |   |     |   | 116.98 |     |   |   | 90.90    |   |   |     | 51.87  |   |     |   | 51.33 |   |   |   | 57.52 |   |
| SNL $250M-$500M Bank Index |   |     | 100.00 |   |     |   | 104.48 |     |   |   | 84.92    |   |   |     | 48.50  |   |     |   | 44.89 |   |   |   | 50.22 |   |
| SNL Midwest Bank Index     |   |     | 100.00 |   |     |   | 115.59 |     |   |   | 90.09    |   |   |     | 59.27  |   |     |   | 50.23 |   |   |   | 62.37 |   |
| Dow Jones                  |   |     | 100.00 |   |     |   | 119.04 |     |   |   | 126.70   |   |   |     | 86.24  |   |     |   | 105.80 |   |   |   | 120.68 |   |

----

|                                                  |   |           |        |   |           |   |        |           |   |   |             |   |   |           |        |   |           |   |        |           |   |   |             |   |   |        |        |   |        |   |        |        |   |
|-------------------------------------------------------|--------|-----------|-------------|--------|-----------|--------|-------------|-----------|--------|--------|-------------|--------|--------|-----------|-------------|--------|-----------|--------|-------------|-----------|--------|--------|-------------|--------|--------|--------|-------------|--------|--------|--------|-------------|--------|--------|
|                                                  |   | 2000      |        |   | 2001      |   |        | 2002      |   |   | 2003        |   |   | 2004      |        |   | 2005      |   |        | 2006      |   |   | 2007        |   |   | 2008   |        |   | 2009   |   |        | 2010   |   |
|                                                  |   |      |        |   |      |   |        |      |   |   |        |   |   |      |        |   |      |   |        |      |   |   |        |   |   |   |        |   |   |   |        |   |   |
| Interest and dividend income                          |   | $         | 23,734,085  |   |      | $      | 24,595,769  |      |   | $      | 22,095,682  |   |   | $         | 20,720,464  |   |      | $      | 20,506,914  |      |   | $      | 22,181,071  |   |   | $      | 25,279,212  |   |   | $      | 26,603,043  |   |   | $ | 25,715,309 |   |   | $ | 23,354,885 |   |   | $ | 21,667,356 |   |
| Interest expense                                      |   |      | 12,336,669  |   |      |   | 12,348,548  |      |   |   | 9,328,867   |   |   |      | 7,837,463   |   |      |   | 7,538,572   |      |   |   | 9,146,249   |   |   |   | 12,837,256  |   |   |   | 14,517,591  |   |   |   | 10,251,384 |   |   |   | 8,064,768 |   |   |   | 6,480,008 |   |
| Net interest income                                   |   |      | 11,397,416  |   |      |   | 12,247,221  |      |   |   | 12,766,815  |   |   |      | 12,883,001  |   |      |   | 12,968,342  |      |   |   | 13,034,822  |   |   |   | 12,441,956  |   |   |   | 12,085,452  |   |   |   | 15,463,925 |   |   |   | 15,290,117 |   |   |   | 15,187,348 |   |
| Provision for loan losses                             |   |      | 587,000     |   |      |   | 780,000     |      |   |   | 630,000     |   |   |      | 540,000     |   |      |   | 618,000     |      |   |   | 412,000     |   |   |   | 1,384,261   |   |   |   | 993,505     |   |   |   | 1,188,270 |   |   |   | 1,325,052 |   |   |   | 1,816,012 |   |
| Net interest income after provision for loan losses   |   |      | 10,810,416  |   |      |   | 11,467,221  |      |   |   | 12,136,815  |   |   |      | 12,343,001  |   |      |   | 12,350,342  |      |   |   | 12,622,822  |   |   |   | 11,057,695  |   |   |   | 11,091,947  |   |   |   | 14,275,655 |   |   |   | 13,965,065 |   |   |   | 13,371,336 |   |
| Noninterest income, including security gains/(losses) |   |      | 1,368,986   |   |      |   | 1,606,046   |      |   |   | 2,059,173   |   |   |      | 2,611,566   |   |      |   | 2,199,020   |      |   |   | 2,341,826   |   |   |   | 2,297,373   |   |   |   | 3,079,567   |   |   |   | 3,066,769 |   |   |   | 3,295,030 |   |   |   | 3,317,126 |   |
| Noninterest expense                                   |   |      | 8,711,655   |   |      |   | 9,382,984   |      |   |   | 9,989,172   |   |   |      | 10,415,947  |   |      |   | 10,452,666  |      |   |   | 10,763,473  |   |   |   | 11,046,170  |   |   |   | 11,252,758  |   |   |   | 12,627,590 |   |   |   | 13,838,651 |   |   |   | 13,921,806 |   |
| Income before income taxes                            |   |      | 3,467,747   |   |      |   | 3,690,283   |      |   |   | 4,206,816   |   |   |      | 4,538,620   |   |      |   | 4,096,696   |      |   |   | 4,201,175   |   |   |   | 2,308,898   |   |   |   | 2,918,755   |   |   |   | 4,714,834 |   |   |   | 3,421,444 |   |   |   | 2,766,656 |   |
| Income tax expense                                    |   |      | 880,772     |   |      |   | 934,696     |      |   |   | 986,653     |   |   |      | 899,229     |   |      |   | 863,799     |      |   |   | 908,647     |   |   |   | 240,891     |   |   |   | 333,926     |   |   |   | 955,700 |   |   |   | 516,524 |   |   |   | 219,289 |   |
| Net income                                            |   | $         | 2,586,975   |   |      | $      | 2,755,587   |      |   | $      | 3,220,163   |   |   | $         | 3,639,391   |   |      | $      | 3,232,897   |      |   | $      | 3,292,528   |   |   | $      | 2,068,007   |   |   | $      | 2,584,829   |   |   | $ | 3,759,134 |   |   | $ | 2,904,920 |   |   | $ | 2,547,367 |   |
|                                                  |   |      |        |   |      |   |        |      |   |   |        |   |   |      |        |   |      |   |        |      |   |   |        |   |   |   |        |   |   |   |        |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total assets                                          |   | $         | 323,885,801 |   |      | $      | 341,317,195 |      |   | $      | 361,711,069 |   |   | $         | 385,522,969 |   |      | $      | 397,521,584 |      |   | $      | 411,932,779 |   |   | $      | 421,653,341 |   |   | $      | 451,370,187 |   |   | $ | 441,804,491 |   |   | $ | 445,970,296 |   |   | $ | 423,434,966 |   |
| Deposits                                              |   |      | 267,552,875 |   |      |   | 283,375,923 |      |   |   | 300,201,533 |   |   |      | 304,525,997 |   |      |   | 300,629,543 |      |   |   | 306,914,758 |   |   |   | 330,005,480 |   |   |   | 330,488,711 |   |   |   | 347,044,549 |   |   |   | 344,542,900 |   |   |   | 325,445,596 |   |
| Shareholders’ equity                            |   |      | 28,679,087  |   |      |   | 30,474,195  |      |   |   | 32,154,862  |   |   |      | 32,514,459  |   |      |   | 32,824,111  |      |   |   | 32,479,697  |   |   |   | 32,580,485  |   |   |   | 33,885,779  |   |   |   | 33,904,759 |   |   |   | 35,211,133 |   |   |   | 35,580,582 |   |
| Loans receivable, net                                 |   |      | 193,707,099 |   |      |   | 180,460,538 |      |   |   | 184,916,798 |   |   |      | 195,765,090 |   |      |   | 212,451,448 |      |   |   | 229,106,682 |   |   |   | 229,171,793 |   |   |   | 232,196,753 |   |   |   | 235,448,307 |   |   |   | 255,335,658 |   |   |   | 276,036,674 |   |
| Allowance for loan losses                             |   |      | 2,790,133   |   |      |   | 2,879,065   |      |   |   | 2,971,116   |   |   |      | 2,843,484   |   |      |   | 2,995,422   |      |   |   | 2,904,447   |   |   |   | 2,345,419   |   |   |   | 2,447,254   |   |   |   | 2,770,360 |   |   |   | 2,390,015 |   |   |   | 2,739,736 |   |
| Net charge-offs                                       |   |      | 906,688     |   |      |   | 691,068     |      |   |   | 537,949     |   |   |      | 667,632     |   |      |   | 466,062     |      |   |   | 502,833     |   |   |   | 1,936,046   |   |   |   | 891,648     |   |   |   | 865,000 |   |   |   | 1,705,000 |   |   |   | 1,466,000 |   |
| Full time employees (average equivalents)             |   |      | 136         |   |      |   | 130         |      |   |   | 130         |   |   |      | 133         |   |      |   | 135         |      |   |   | 132         |   |   |   | 132         |   |   |   | 123         |   |   |   | 142 |   |   |   | 136 |   |   |   | 146 |   |
| Banking locations                                     |   | Seventeen |        |   | Seventeen |   |        | Seventeen |   |   | Seventeen   |   |   | Seventeen |        |   | Seventeen |   |        | Seventeen |   |   | Seventeen   |   |   | Twenty |        |   | Twenty |   |        | Twenty |   |
|                                                  |   |      |        |   |      |   |        |      |   |   |        |   |   |      |        |   |      |   |        |      |   |   |        |   |   |   |        |   |   |   |        |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Earnings per common share - Basic                     |   | $         | 0.51        |   |      | $      | 0.56        |      |   | $      | 0.67        |   |   | $         | 0.76        |   |      | $      | 0.69        |      |   | $      | 0.71        |   |   | $      | 0.45        |   |   | $      | 0.57        |   |   | $ | 0.82 |   |   | $ | 0.62 |   |   | $ | 0.52 |   |
| Earnings per common share - Diluted                   |   |      | 0.51        |   |      |   | 0.56        |      |   |   | 0.67        |   |   |      | 0.76        |   |      |   | 0.69        |      |   |   | 0.71        |   |   |   | 0.45        |   |   |   | 0.57        |   |   |   | 0.82 |   |   |   | 0.62 |   |   |   | 0.52 |   |
| Dividends per share                                   |   |      | 0.31        |   |      |   | 0.32        |      |   |   | 0.33        |   |   |      | 0.35        |   |      |   | 0.39        |      |   |   | 0.43        |   |   |   | 0.48        |   |   |   | 0.52        |   |   |   | 0.54 |   |   |   | 0.56 |   |   |   | 0.56 |   |
| Book value per share                                  |   |      | 5.72        |   |      |   | 6.23        |      |   |   | 6.72        |   |   |      | 7.67        |   |      |   | 7.09        |      |   |   | 7.00        |   |   |   | 7.73        |   |   |   | 7.41        |   |   |   | 7.35 |   |   |   | 7.53 |   |   |   | 7.52 |   |
| Market value range per share                          |   |      | 4.63-8.68   |   |      |   | 5.95-8.93   |      |   |   | 7.82-9.54   |   |   |      | 8.96-13.60  |   |      |   | 9.43-13.56  |      |   |   | 9.10-12.69  |   |   |   | 9.36-11.36  |   |   |   | 9.78-11.39  |   |   |   | 7.41-10.85 |   |   |   | 7.00-9.49 |   |   |   | 7.70-9.90 |   |
|                                                  |   |      |        |   |      |   |        |      |   |   |        |   |   |      |        |   |      |   |        |      |   |   |        |   |   |   |        |   |   |   |        |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Cash dividends paid                                   |   | $         | 1,549,657   |   |      | $      | 1,590,220   |      |   | $      | 1,647,670   |   |   | $         | 1,717,838   |   |      | $      | 1,878,788   |      |   | $      | 2,114,723   |   |   | $      | 2,415,741   |   |   | $      | 2,435,317   |   |   | $ | 2,707,438 |   |   | $ | 2,871,801 |   |   | $ | 2,959,658 |   |
| Return on average assets (ROA)                        |   |      | 0.83        | %      |      |   | 0.82        | %         |   |   | 0.94        | %      |   |      | 0.97        | %      |      |   | 0.83        | %         |   |   | 0.82        | %      |   |   | 0.50        | %      |   |   | 0.60        | %      |   |   | 0.86 | % |   |   | 0.63 | % |   |   | 0.57 | % |
| Return on average equity (ROE)                        |   |      | 9.88        | %      |      |   | 9.13        | %         |   |   | 10.34       | %      |   |      | 11.40       | %      |      |   | 9.91        | %         |   |   | 10.01       | %      |   |   | 6.49        | %      |   |   | 8.12        | %      |   |   | 11.33 | % |   |   | 7.56 | % |   |   | 7.05 | % |

----

----

----

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| 1 = United Bancorp, Inc. |   | 2 = The Citizens Savings Bank |
|--------------------------|--------|-------------------------------|

----

| 1 = United Bancorp, Inc. |   | 2 = The Citizens Savings Bank |
|--------------------------|--------|-------------------------------|

----

| DIRECTORS OF UNITED BANCORP, INC.                           |
|-------------------------------------------------------------|
|                                                        |
| James W. Everson1                                           |   | Chairman, President & Chief Executive Officer, United Bancorp, Inc., |
|                                                        |   | Chairman, The Citizens Savings Bank, Martins Ferry, Ohio |
| Scott A. Everson                                            |   | Senior Vice President & Chief Operating Officer, United Bancorp, Inc. |
|                                                        |   | President & Chief Executive Officer, The Citizens Savings Bank, Martins Ferry, Ohio |
| John M. Hoopingarner1,3,4                                   |   | Executive Director, Muskingum Watershed Conservancy District, New Philadelphia, Ohio |
| Samuel J. Jones2,4                                          |   | Business Owner, Glouster, Ohio |
| Terry A. McGhee1,3                                          |   | President & Chief Executive Officer, Westerman Inc., Bremen, Ohio |
| Richard L. Riesbeck1,2,4,                                   |   | President, Riesbeck Food Markets, Inc., St. Clairsville, Ohio |
| Matthew C. Thomas2,3                                        |   | President, M.C. Thomas Insurance Agency, Inc., Bridgeport, Ohio |
| Michael J. Arciello                                         |   | Director Emeritus1992 - 2009 |
| L.E. "Dick" Richardson                                      |   | Director Emeritus1998 - 2007 |
|                                                        |   |   |
| OFFICERS OF UNITED BANCORP, INC.                            |
|                                                        |
| James W. Everson                                            |   | Chairman, President & Chief Executive Officer |
| Scott A. Everson                                            |   | Senior Vice President & Chief Operating Officer |
| Randall M. Greenwood                                        |   | Senior Vice President, Chief Financial Officer & Secretary/Treasurer |
| Matthew F. Branstetter                                      |   | Vice President - Chief Lending Officer |
| Elmer K. Leeper                                             |   | Vice President - Chief Retail Banking Officer |
| Michael A. Lloyd                                            |   | Vice President - Chief Information Officer |
|                                                        |   |   |
| DIRECTORS OF THE CITIZENS SAVINGS BANK, MARTINS FERRY, OHIO |
|                                                        |
| Herman E. Borkoski2                                         |   | President, Borkoski Funeral Homes, Inc., Tiltonsville, Ohio |
| James W. Everson1                                           |   | Chairman, President & Chief Executive Officer, United Bancorp, Inc., |
|                                                        |   | Chairman, The Citizens Savings Bank, Martins Ferry, Ohio |
| Scott A. Everson1                                           |   | Senior Vice President & Chief Operating Officer, United Bancorp, Inc. |
|                                                        |   | President & Chief Executive Officer, The Citizens Savings Bank, Martins Ferry, Ohio |
| Leon F. Favede, O.D.                                        |   | Optometrist, Bridgeport, Ohio |
| John R. Herzig                                              |   | President, Toland-Herzig Funeral Homes & Crematory, Strasburg, Ohio |
| John M. Hoopingarner1                                       |   | Executive Director, Muskingum Watershed Conservancy District, New Philadelphia, Ohio |
|                                                        |   |   |
| Samuel J. Jones2                                            |   | Business Owner, Glouster, Ohio |
| Andrew F. Phillips                                          |   | President & General Manager, Miller Brands of S.E. Ohio, Glouster, Ohio |
| Robin L. Rhodes, M.D.                                       |   | Physician, Pediatric Associates of Lancaster, Inc., Lancaster, Ohio |
| Richard L. Riesbeck1,2,æ                               |   | President, Riesbeck Food Markets, Inc., St. Clairsville, Ohio |
| Errol C. Sambuco2                                           |   | Consultant, Martins Ferry, Ohio |
| Matthew C. Thomas1                                          |   | President, M.C. Thomas Insurance Agency, Inc., Bridgeport, Ohio |

| 1 = Executive Committee | 2 = Audit Committee | 3 = Compensation Committee |
|-------------------------|---------------------|----------------------------|

| 4 = Nominating and Governance Committee |   |  = Lead Director |
|-----------------------------------------|--------|-----------------------|

----

|               |   | 2010   |   |   | 2009   |   |
|--------------------|--------|--------|--------|--------|--------|--------|
|               |   | 31-Mar |   |   | 30-Jun |   |   | 30-Sep |   |   | 31-Dec |   |   | 31-Mar |   |   | 30-Jun |   |   | 30-Sep |   |   | 31-Dec |   |
| Market Price Range |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| High ($)           |   | $      | 9.90   |   |   |   | 8.70 |   |   |   | 8.99 |   |   |   | 9.00 |   |   |   | 9.49 |   |   |   | 8.90 |   |   |   | 8.50 |   |   |   | 8.61 |   |
| Low ($)            |   | $      | 8.12   |   |   |   | 8.00 |   |   |   | 7.70 |   |   |   | 7.70 |   |   |   | 7.00 |   |   |   | 7.50 |   |   |   | 7.50 |   |   |   | 7.10 |   |
|               |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Cash Dividends     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Quarter ($)        |   | $      | 0.14   |   |   |   | 0.14 |   |   |   | 0.14 |   |   |   | 0.14 |   |   |   | 0.14 |   |   |   | 0.14 |   |   |   | 0.14 |   |   |   | 0.14 |   |
| Cumulative ($)     |   | $      | 0.14   |   |   |   | 0.28 |   |   |   | 0.42 |   |   |   | 0.56 |   |   |   | 0.14 |   |   |   | 0.28 |   |   |   | 0.42 |   |   |   | 0.56 |   |

----

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| (In thousands)                                 |   |   |   |   |   |   |
|------------------------------------------------|--------|--------|--------|--------|--------|--------|
|                                           |   | 2010   |   |   | 2009   |   |
| Noninterest income                             |   |   |   |   |   |   |
| Customer service fee                           |   | $      | 2,229  |   |   | $      | 2,189 |   |
| Gain (loss) on sales of securities             |   |   | 47     |   |   |   | 154 |   |
| Gains on sales of loans                        |   |   | 184    |   |   |   | 129 |   |
| Other income                                   |   |   | 857    |   |   |   | 823 |   |
| Total noninterest income                       |   | $      | 3,317  |   |   | $      | 3,295 |   |
|                                           |   |   |   |   |   |   |   |   |
| Noninterest expense                            |   |   |   |   |   |   |   |   |
| Salaries and employee benefits                 |   | $      | 6,829  |   |   | $      | 6,685 |   |
| Occupancy and equipment                        |   |   | 1,683  |   |   |   | 1,664 |   |
| Provision for losses on foreclosed real estate |   |   | 90     |   |   |   | - |   |
| Professional services                          |   |   | 824    |   |   |   | 762 |   |
| Insurance                                      |   |   | 384    |   |   |   | 343 |   |
| Deposit insurance premiums                     |   |   | 514    |   |   |   | 866 |   |
| Franchise and other taxes                      |   |   | 505    |   |   |   | 497 |   |
| Marketing expense                              |   |   | 289    |   |   |   | 322 |   |
| Printing and office supplies                   |   |   | 261    |   |   |   | 311 |   |
| Amortization of intangibles                    |   |   | 113    |   |   |   | 119 |   |
| Core computer conversion expense               |   |   | 273    |   |   |   | - |   |
| Other expenses                                 |   |   | 2,157  |   |   |   | 2,270 |   |
| Total noninterest expense                      |   | $      | 13,922 |   |   | $      | 13,839 |   |

----

----

----

| (Dollars in Thousands)                                      |   |
|-----------------------------------------------------------------------|--------|
| Net Portfolio Value - December 31, 2010 |   |
| Change in Rates                                             |   |   | $ Amount |   |   | $ Change |   |   | % Change |   |
|                                                                  | +200   |   |   |   | 53,457 |   |   |   | (984 | ) |   |   | -2 | % |
|                                                                  | +100   |   |   |   | 55,027 |   |   |   | 586 |   |   |   | 1 | % |
| Base                                                                  |   |   |   | 54,441 |   |   |   | - |   |   |   | - |   |
|                                                                  | -100   |   |   |   | 49,843 |   |   |   | (4,598 | ) |   |   | -8 | % |
|                                                                  | -200   |   |   |   | 43,354 |   |   |   | (11,087 | ) |   |   | -20 | % |

| (Dollars in Thousands)                                      |   |
|-----------------------------------------------------------------------|--------|
| Net Portfolio Value - December 31, 2009 |   |
| Change in Rates                                             |   |   | $ Amount |   |   | $ Change |   |   | % Change |   |
|                                                                  | +200   |   |   |   | 47,097 |   |   |   | (3,623 | ) |   |   | -7 | % |
|                                                                  | +100   |   |   |   | 50,680 |   |   |   | (40 | ) |   |   | - |   |
| Base                                                                  |   |   |   | 50,720 |   |   |   | - |   |   |   | - |   |
|                                                                  | -100   |   |   |   | 46,705 |   |   |   | (4,015 | ) |   |   | -8 | % |
|                                                                  | -200   |   |   |   | 40,570 |   |   |   | (10,150 | ) |   |   | -20 | % |

----

|                                              |   | 1st Quarter                           |   |   | 2nd Quarter |   |   | 3rd Quarter |   |   | 4th Quarter |   |
|---------------------------------------------------|--------|---------------------------------------|--------|--------|-------------|--------|--------|-------------|--------|--------|-------------|--------|
|                                              |   | (In thousands, except per share data) |   |
| 2010                                              |   |                                  |   |   |        |   |   |        |   |   |        |   |
|                                              |   |                                  |   |   |        |   |   |        |   |   |        |   |
| Total interest income                             |   | $                                     | 5,530  |   |        | $      | 5,513  |        |   | $      | 5,403       |   |   | $ | 5,221 |   |
| Total interest expense                            |   |                                  | 1,804  |   |        |   | 1,715  |        |   |   | 1,582       |   |   |   | 1,379 |   |
|                                              |   |                                  |   |   |        |   |   |        |   |   |        |   |   |   |   |   |
| Net interest income                               |   |                                  | 3,726  |   |        |   | 3,798  |        |   |   | 3,821       |   |   |   | 3,842 |   |
|                                              |   |                                  |   |   |        |   |   |        |   |   |        |   |   |   |   |   |
| Provision for losses on loans                     |   |                                  | 360    |   |        |   | 370    |        |   |   | 321         |   |   |   | 765 |   |
| Other income                                      |   |                                  | 776    |   |        |   | 859    |        |   |   | 849         |   |   |   | 786 |   |
| Gain on sale of available for-sale securities net |   |                                  | -      |   |        |   | -      |        |   |   | 47          |   |   |   | - |   |
| General, administrative and other expense         |   |                                  | 3,371  |   |        |   | 3,471  |        |   |   | 3,687       |   |   |   | 3,393 |   |
|                                              |   |                                  |   |   |        |   |   |        |   |   |        |   |   |   |   |   |
| Income before income taxes                        |   |                                  | 771    |   |        |   | 816    |        |   |   | 709         |   |   |   | 470 |   |
| Federal income taxes (benefit)                    |   |                                  | 88     |   |        |   | 115    |        |   |   | (1          | )      |   |   | 17 |   |
|                                              |   |                                  |   |   |        |   |   |        |   |   |        |   |   |   |   |   |
| Net income                                        |   | $                                     | 683    |   |        | $      | 701    |        |   | $      | 710         |   |   | $ | 453 |   |
|                                              |   |                                  |   |   |        |   |   |        |   |   |        |   |   |   |   |   |
| Earnings per share                                |   |                                  |   |   |        |   |   |        |   |   |        |   |   |   |   |   |
| Basic                                             |   | $                                     | 0.14   |   |        | $      | 0.14   |        |   | $      | 0.15        |   |   | $ | 0.09 |   |
| Diluted                                           |   | $                                     | 0.14   |   |        | $      | 0.14   |        |   | $      | 0.15        |   |   | $ | 0.09 |   |

| 2009                                              |   |                     |   |   |                       |   |   |                       |   |   |                       |   |
|---------------------------------------------------|--------|--------------------------------------------------------------------------------------------------------------------|--------|--------|--------------------------------------------------------------------------------------------------------------------------------|--------|--------|--------------------------------------------------------------------------------------------------------------------------------|--------|--------|--------------------------------------------------------------------------------------------------------------------------------|--------|
|                                              |   |                                                                                                               |   |   |                                                                                                                           |   |   |                                                                                                                           |   |   |                                                                                                                           |   |
| Total interest income                             |   | $                                                                                                                  | 5,913  |   |                                                                                                                           | $      | 5,861  |                                                                                                                           |   | $      | 5,841                                                                                                                          |   |   | $ | 5,740 |   |
| Total interest expense                            |   |                                                                                                               | 2,074  |   |                                                                                                                           |   | 2,027  |                                                                                                                           |   |   | 2,011                                                                                                                          |   |   |   | 1,953 |   |
|                                              |   |                                                                                                               |   |   |                                                                                                                           |   |   |                                                                                                                           |   |   |                                                                                                                           |   |   |   |   |   |
| Net interest income                               |   |                                                                                                               | 3,839  |   |                                                                                                                           |   | 3,834  |                                                                                                                           |   |   | 3,830                                                                                                                          |   |   |   | 3,787 |   |
|                                              |   |                                                                                                               |   |   |                                                                                                                           |   |   |                                                                                                                           |   |   |                                                                                                                           |   |   |   |   |   |
| Provision for losses on loans                     |   |                                                                                                               | 324    |   |                                                                                                                           |   | 334    |                                                                                                                           |   |   | 338                                                                                                                            |   |   |   | 329 |   |
| Other income                                      |   |                                                                                                               | 789    |   |                                                                                                                           |   | 788    |                                                                                                                           |   |   | 828                                                                                                                            |   |   |   | 736 |   |
| Gain on sale of available for-sale securities net |   |                                                                                                               | -      |   |                                                                                                                           |   | 25     |                                                                                                                           |   |   | -                                                                                                                              |   |   |   | 129 |   |
| General, administrative and other expense         |   |                                                                                                               | 3,309  |   |                                                                                                                           |   | 3,567  |                                                                                                                           |   |   | 3,420                                                                                                                          |   |   |   | 3,543 |   |
|                                              |   |                                                                                                               |   |   |                                                                                                                           |   |   |                                                                                                                           |   |   |                                                                                                                           |   |   |   |   |   |
| Income before income taxes                        |   |                                                                                                               | 995    |   |                                                                                                                           |   | 746    |                                                                                                                           |   |   | 900                                                                                                                            |   |   |   | 780 |   |
| Federal income taxes                              |   |                                                                                                               | 194    |   |                                                                                                                           |   | 74     |                                                                                                                           |   |   | 143                                                                                                                            |   |   |   | 105 |   |
|                                              |   |                                                                                                               |   |   |                                                                                                                           |   |   |                                                                                                                           |   |   |                                                                                                                           |   |   |   |   |   |
| Net income                                        |   | $                                                                                                                  | 801    |   |                                                                                                                           | $      | 672    |                                                                                                                           |   | $      | 757                                                                                                                            |   |   | $ | 675 |   |
|                                              |   |                                                                                                               |   |   |                                                                                                                           |   |   |                                                                                                                           |   |   |                                                                                                                           |   |   |   |   |   |
| Earnings per share                                |   |                                                                                                               |   |   |                                                                                                                           |   |   |                                                                                                                           |   |   |                                                                                                                           |   |   |   |   |   |
| Basic                                             |   | $                                                                                                                  | 0.17   |   |                                                                                                                           | $      | 0.15   |                                                                                                                           |   | $      | 0.16                                                                                                                           |   |   | $ | 0.14 |   |
| Diluted                                           |   | $                                                                                                                  | 0.17   |   |                                                                                                                           | $      | 0.15   |                                                                                                                           |   | $      | 0.16                                                                                                                           |   |   | $ | 0.14 |   |

----

|                                               |   | 2010    |    |   | 2009     |   |
|----------------------------------------------------|--------|---------|---------|--------|----------|--------|
| (Dollars In thousands)                   |   |    |    |   | Interest |   |   |   |   |   |   |   |   | Interest |   |   |   |   |
|                                          |   | Average |    |   | Income/  |   |   | Yield/ |   |   | Average |   |   | Income/ |   |   | Yield/ |   |
|                                          |   | Balance |    |   | Expense  |   |   | Rate |   |   | Balance |   |   | Expense |   |   | Rate |   |
| Assets                                             |   |    |    |   |     |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Interest-earning assets                            |   |    |    |   |     |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Loans                                              |   | $       | 263,480 |   |     | $      | 17,763 |   |   |   | 6.74 | % |   | $ | 243,599 |   |   | $ | 16,746 |   |   |   | 6.87 | % |
| Taxable securities - AFS                           |   |    | 62,405  |   |     |   | 2,229 |   |   |   | 3.57 |   |   |   | 83,949 |   |   |   | 4,205 |   |   |   | 5.01 |   |
| Tax-exempt securities - AFS                        |   |    | 21,772  |   |     |   | 1,262 |   |   |   | 5.80 |   |   |   | 27,783 |   |   |   | 1,603 |   |   |   | 5.77 |   |
| Tax-exempt securities - HTM                        |   |    | 14,887  |   |     |   | 945 |   |   |   | 6.35 |   |   |   | 14,277 |   |   |   | 901 |   |   |   | 6.31 |   |
| Time deposits in other financial institutions      |   |    | 7,138   |   |     |   | 143 |   |   |   | 2.00 |   |   |   | 19,560 |   |   |   | 408 |   |   |   | 2.08 |   |
| Federal funds sold                                 |   |    | 27,289  |   |     |   | 76 |   |   |   | 0.28 |   |   |   | 24,288 |   |   |   | 49 |   |   |   | 0.20 |   |
| FHLB stock and other                               |   |    | 4,772   |   |     |   | 213 |   |   |   | 4.46 |   |   |   | 4,814 |   |   |   | 241 |   |   |   | 5.01 |   |
| Total interest-earning assets                      |   |    | 401,743 |   |     |   | 22,631 |   |   |   | 5.63 |   |   |   | 418,270 |   |   |   | 24,153 |   |   |   | 5.77 |   |
|                                               |   |    |    |   |     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Noninterest-earning assets                         |   |    |    |   |     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Cash and due from banks                            |   |    | 23,976  |   |     |   |   |   |   |   |   |   |   |   | 10,358 |   |   |   |   |   |   |   |   |   |
| Premises and equipment (net)                       |   |    | 8,565   |   |     |   |   |   |   |   |   |   |   |   | 8,557 |   |   |   |   |   |   |   |   |   |
| Other nonearning assets                            |   |    | 15,885  |   |     |   |   |   |   |   |   |   |   |   | 16,450 |   |   |   |   |   |   |   |   |   |
| Less: allowance for loan losses                    |   |    | (2,637  | )      |     |   |   |   |   |   |   |   |   |   | (3,062 | ) |   |   |   |   |   |   |   |   |
| Total noninterest-earning assets                   |   |    | 45,789  |   |     |   |   |   |   |   |   |   |   |   | 32,303 |   |   |   |   |   |   |   |   |   |
| Total assets                                       |   | $       | 447,532 |   |     |   |   |   |   |   |   |   |   | $ | 450,573 |   |   |   |   |   |   |   |   |   |
|                                               |   |    |    |   |     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Liabilities & stockholders’ equity       |   |    |    |   |     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Interest-bearing liabilities                       |   |    |    |   |     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Demand deposits                                    |   | $       | 109,523 |   |     | $      | 164 |   |   |   | 0.15 | % |   | $ | 112,686 |   |   | $ | 476 |   |   |   | 0.42 | % |
| Savings deposits                                   |   |    | 49,581  |   |     |   | 83 |   |   |   | 0.17 |   |   |   | 42,844 |   |   |   | 163 |   |   |   | 0.38 |   |
| Time deposits                                      |   |    | 160,445 |   |     |   | 4,159 |   |   |   | 2.59 |   |   |   | 168,972 |   |   |   | 5,305 |   |   |   | 3.14 |   |
| FHLB advances                                      |   |    | 46,933  |   |     |   | 1,797 |   |   |   | 3.83 |   |   |   | 48,109 |   |   |   | 1,828 |   |   |   | 3.80 |   |
| Trust preferred debentures                         |   |    | 4,000   |   |     |   | 250 |   |   |   | 6.25 |   |   |   | 4,000 |   |   |   | 250 |   |   |   | 6.25 |   |
| Repurchase agreements                              |   |    | 12,734  |   |     |   | 27 |   |   |   | 0.21 |   |   |   | 10,999 |   |   |   | 43 |   |   |   | 0.39 |   |
| Total interest-bearing liabilities                 |   |    | 383,216 |   |     |   | 6,480 |   |   |   | 1.69 |   |   |   | 387,610 |   |   |   | 8,065 |   |   |   | 2.08 |   |
|                                               |   |    |    |   |     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Noninterest-bearing liabilities                    |   |    |    |   |     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Demand deposits                                    |   |    | 24,530  |   |     |   |   |   |   |   |   |   |   |   | 24,157 |   |   |   |   |   |   |   |   |   |
| Other liabilities                                  |   |    | 3,638   |   |     |   |   |   |   |   |   |   |   |   | 5,116 |   |   |   |   |   |   |   |   |   |
| Total noninterest-bearing liabilities              |   |    | 28,168  |   |     |   |   |   |   |   |   |   |   |   | 29,273 |   |   |   |   |   |   |   |   |   |
| Total liabilities                                  |   |    | 411,384 |   |     |   |   |   |   |   |   |   |   |   | 416,883 |   |   |   |   |   |   |   |   |   |
| Total stockholders’ equity                   |   |    | 36,148  |   |     |   |   |   |   |   |   |   |   |   | 33,690 |   |   |   |   |   |   |   |   |   |
| Total liabilities & stockholders’ equity |   | $       | 447,532 |   |     |   |   |   |   |   |   |   |   | $ | 450,573 |   |   |   |   |   |   |   |   |   |
| Net interest income                                |   |    |    |   |     | $      | 16,151 |   |   |   |   |   |   |   |   |   |   | $ | 16,088 |   |   |   |   |   |
| Net interest spread                                |   |    |    |   |     |   |   |   |   |   | 3.94 | % |   |   |   |   |   |   |   |   |   |   | 3.69 | % |
|                                               |   |    |    |   |     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net yield on interest-earning assets               |   |    |    |   |     |   |   |   |   |   | 4.02 | % |   |   |   |   |   |   |   |   |   |   | 3.98 | % |

----

| · | Volume variance results when the change in volume is multiplied by the previous year’s rate. |
|--------|----------------------------------------------------------------------------------------------------|

| · | Rate variance results when the change in rate is multiplied by the previous year’s volume. |
|--------|--------------------------------------------------------------------------------------------------|

| · | Rate/volume variance results when the change in volume is multiplied by the change in rate. |
|--------|---------------------------------------------------------------------------------------------|

|                                         |   | 2010 Compared to 2009 |   |
|----------------------------------------------|--------|--------------------------------------|--------|
|                                    |   | Increase/(Decrease)                  |   |
| (In thousands)                          |   |                                 |   |   | Change |   |   | Change |   |
|                                    |   | Total                                |   |   | Due To |   |   | Due To |   |
|                                    |   | Change                               |   |   | Volume |   |   | Rate |   |
| Interest and dividend income                 |   |                                 |   |   |   |   |   |   |   |
| Loans                                        |   | $                                    | 1,017  |   |   | $ | 1,345 |   |   | $ | (328 | ) |
| Taxable securities available for sale        |   |                                 | (1,976 | ) |   |   | (933 | ) |   |   | (1,043 | ) |
| Tax-exempt securities available for sale     |   |                                 | (341   | ) |   |   | (348 | ) |   |   | 7 |   |
| Tax-exempt securities held to maturity       |   |                                 | 44     |   |   |   | 39 |   |   |   | 5 |   |
| Time deposites in other financial institutes |   |                                 | (265   | ) |   |   | (249 | ) |   |   | (16 | ) |
| Federal funds sold                           |   |                                 | 27     |   |   |   | 7 |   |   |   | 20 |   |
| FHLB stock and other                         |   |                                 | (28    | ) |   |   | (2 | ) |   |   | (26 | ) |
| Total interest and dividend income           |   |                                 | (1,522 | ) |   |   | (141 | ) |   |   | (1,381 | ) |
|                                         |   |                                 |   |   |   |   |   |   |   |   |   |   |
| Interest expense                             |   |                                 |   |   |   |   |   |   |   |   |   |   |
| Demand deposits                              |   |                                 | (312   | ) |   |   | (16 | ) |   |   | (296 | ) |
| Savings deposits                             |   |                                 | (80    | ) |   |   | 22 |   |   |   | (102 | ) |
| Time deposits                                |   |                                 | (1,146 | ) |   |   | (257 | ) |   |   | (889 | ) |
| FHLB advances                                |   |                                 | (31    | ) |   |   | (45 | ) |   |   | 14 |   |
| Trust Preferred debentures                   |   |                                 | -      |   |   |   | - |   |   |   | - |   |
| Repurchase agreements                        |   |                                 | (16    | ) |   |   | 6 |   |   |   | (22 | ) |
| Total interest expense                       |   |                                 | (1,585 | ) |   |   | (290 | ) |   |   | (1,295 | ) |
|                                         |   |                                 |   |   |   |   |   |   |   |   |   |   |
| Net interest income                          |   | $                                    | 63     |   |   | $ | 149 |   |   | $ | (86 | ) |

----

----

----

----

|                                                                                                                |   | 2010   |           |   | 2009   |   |
|---------------------------------------------------------------------------------------------------------------------|--------|--------|----------------|--------|--------|--------|
| Assets                                                                                                              |   |   |           |   |   |   |
| Cash and due from banks                                                                                             |   | $      | 5,006          |   |   | $      | 4,862 |   |
| Interest-bearing demand deposits                                                                                    |   |   | 5,929          |   |   |   | 11,409 |   |
| Federal funds sold                                                                                                  |   |   | –– |   |   |   | 15,000 |   |
| Cash and cash equivalents                                                                                           |   |   | 10,935         |   |   |   | 31,271 |   |
|                                                                                                                |   |   |           |   |   |   |   |   |
| Certificates of deposit in other financial institutions                                                             |   |   | 2,564          |   |   |   | 17,575 |   |
| Available-for-sale securities                                                                                       |   |   | 96,155         |   |   |   | 96,585 |   |
| Held-to-maturity securities                                                                                         |   |   | 6,331          |   |   |   | 14,277 |   |
| Loans, net of allowance for loan losses of $2,740 and $2,390 at December 31, 2010 and 2009, respectively            |   |   | 276,037        |   |   |   | 255,336 |   |
| Premises and equipment                                                                                              |   |   | 9,278          |   |   |   | 8,689 |   |
| Federal Home Loan Bank stock                                                                                        |   |   | 4,810          |   |   |   | 4,810 |   |
| Foreclosed assets held for sale, net                                                                                |   |   | 1,912          |   |   |   | 1,378 |   |
| Intangible assets                                                                                                   |   |   | 543            |   |   |   | 656 |   |
| Accrued interest receivable                                                                                         |   |   | 1,441          |   |   |   | 2,218 |   |
| Deferred federal income taxes                                                                                       |   |   | 801            |   |   |   | 333 |   |
| Bank-owned life insurance                                                                                           |   |   | 10,401         |   |   |   | 10,018 |   |
| Other assets                                                                                                        |   |   | 2,227          |   |   |   | 2,824 |   |
| Total assets                                                                                                        |   | $      | 423,435        |   |   | $      | 445,970 |   |
|                                                                                                                |   |   |           |   |   |   |   |   |
| Liabilities and Stockholders’ Equity                                                                          |   |   |           |   |   |   |   |   |
| Liabilities                                                                                                         |   |   |           |   |   |   |   |   |
| Deposits                                                                                                            |   |   |           |   |   |   |   |   |
| Demand                                                                                                              |   | $      | 131,600        |   |   | $      | 130,363 |   |
| Savings                                                                                                             |   |   | 52,463         |   |   |   | 45,497 |   |
| Time                                                                                                                |   |   | 141,383        |   |   |   | 168,683 |   |
| Total deposits                                                                                                      |   |   | 325,446        |   |   |   | 344,543 |   |
| Short-term borrowings                                                                                               |   |   | 11,843         |   |   |   | 10,277 |   |
| Federal Home Loan Bank advances                                                                                     |   |   | 43,450         |   |   |   | 49,128 |   |
| Subordinated debentures                                                                                             |   |   | 4,000          |   |   |   | 4,000 |   |
| Interest payable and other liabilities                                                                              |   |   | 3,115          |   |   |   | 2,811 |   |
| Total liabilities                                                                                                   |   |   | 387,854        |   |   |   | 410,759 |   |
|                                                                                                                |   |   |           |   |   |   |   |   |
| Stockholders’ Equity                                                                                          |   |   |           |   |   |   |   |   |
| Preferred stock, no par value, authorized 2,000,000 shares; no shares issued                                        |   |   | –– |   |   |   | –– |   |
| Common stock, $1 par value; authorized 10,000,000 shares; issued  5,370,304 shares                        |   |   | 5,370          |   |   |   | 5,370 |   |
| Additional paid-in capital                                                                                          |   |   | 20,133         |   |   |   | 22,830 |   |
| Retained earnings                                                                                                   |   |   | 15,308         |   |   |   | 12,761 |   |
| Stock held by deferred compensation plan; 2010 – 176,392 shares,   2009 – 155,198 shares |   |   | (1,657         | )      |   |   | (1,478 | ) |
| Unearned ESOP compensation                                                                                          |   |   | (2,311         | )      |   |   | (2,512 | ) |
| Accumulated other comprehensive loss                                                                                |   |   | (707           | )      |   |   | (507 | ) |
| Treasury stock, at cost                                                                                             |   |   |           |   |   |   |   |   |
| 2010 –  45,717 shares, 2009 – 113,493 shares                                                  |   |   | (555           | )      |   |   | (1,253 | ) |
| Total stockholders’ equity                                                                                    |   |   | 35,581         |   |   |   | 35,211 |   |
| Total liabilities and stockholders’ equity                                                                    |   | $      | 423,435        |   |   | $      | 445,970 |   |

----

|                                                     |   | 2010   |   |   | 2009   |   |
|----------------------------------------------------------|--------|--------|--------|--------|--------|--------|
| Interest and Dividend Income                             |   |   |   |   |   |   |
| Loans                                                    |   | $      | 17,513 |   |   | $      | 16,746 |   |
| Securities                                               |   |   |   |   |   |   |   |   |
| Taxable                                                  |   |   | 2,229  |   |   |   | 4,205 |   |
| Tax-exempt                                               |   |   | 1,493  |   |   |   | 1,706 |   |
| Certificates of deposit in other financial institutions  |   |   | 143    |   |   |   | 408 |   |
| Federal funds sold                                       |   |   | 76     |   |   |   | 49 |   |
| Dividends on Federal Home Loan Bank and other stock      |   |   | 213    |   |   |   | 241 |   |
| Total interest and dividend income                       |   |   | 21,667 |   |   |   | 23,355 |   |
| Interest Expense                                         |   |   |   |   |   |   |   |   |
| Deposits                                                 |   |   | 4,406  |   |   |   | 5,941 |   |
| Borrowings                                               |   |   | 2,074  |   |   |   | 2,124 |   |
| Total interest expense                                   |   |   | 6,480  |   |   |   | 8,065 |   |
| Net Interest Income                                      |   |   | 15,187 |   |   |   | 15,290 |   |
| Provision for Loan Losses                                |   |   | 1,816  |   |   |   | 1,325 |   |
| Net Interest Income After Provision for Loan Losses      |   |   | 13,371 |   |   |   | 13,965 |   |
| Noninterest Income                                       |   |   |   |   |   |   |   |   |
| Customer service fees                                    |   |   | 2,229  |   |   |   | 2,189 |   |
| Net gains on loan sales                                  |   |   | 184    |   |   |   | 129 |   |
| Gain on sales of securities - net                        |   |   | 47     |   |   |   | 154 |   |
| Earnings on bank-owned life insurance                    |   |   | 423    |   |   |   | 407 |   |
| Gain on sale of real estate and other repossessed assets |   |   | 30     |   |   |   | 105 |   |
| Other                                                    |   |   | 404    |   |   |   | 311 |   |
| Total noninterest income                                 |   |   | 3,317  |   |   |   | 3,295 |   |
| Noninterest Expense                                      |   |   |   |   |   |   |   |   |
| Salaries and employee benefits                           |   |   | 6,829  |   |   |   | 6,685 |   |
| Net occupancy and equipment expense                      |   |   | 1,683  |   |   |   | 1,664 |   |
| Provision for losses on foreclosed real estate           |   |   | 90     |   |   |   | –– |   |
| Professional fees                                        |   |   | 824    |   |   |   | 762 |   |
| Insurance                                                |   |   | 384    |   |   |   | 343 |   |
| Deposit insurance premiums                               |   |   | 514    |   |   |   | 866 |   |
| Franchise and other taxes                                |   |   | 505    |   |   |   | 497 |   |
| Marketing expense                                        |   |   | 289    |   |   |   | 322 |   |
| Printing and office supplies                             |   |   | 261    |   |   |   | 311 |   |
| Amortization of intangible assets                        |   |   | 113    |   |   |   | 119 |   |
| Core computer conversion expense                         |   |   | 273    |   |   |   | –– |   |
| Other                                                    |   |   | 2,157  |   |   |   | 2,270 |   |
| Total noninterest expense                                |   |   | 13,922 |   |   |   | 13,839 |   |
|                                                     |   |   |   |   |   |   |   |   |
| Income Before Federal Income Taxes                       |   |   | 2,766  |   |   |   | 3,421 |   |
| Provision for Federal Income Taxes                       |   |   | 219    |   |   |   | 516 |   |
| Net Income                                               |   | $      | 2,547  |   |   | $      | 2,905 |   |
| Basic Earnings Per Share                                 |   | $      | 0.52   |   |   | $      | 0.62 |   |
| Diluted Earnings Per Share                               |   | $      | 0.52   |   |   | $      | 0.62 |   |

----

|                                                                                   |   |   |           |   |       |   |           | Treasury       |   |   | Shares         |   |   |     |           |   | Accumulated   |   |           |   |   |
|----------------------------------------------------------------------------------------|--------|--------|----------------|--------|------------|--------|----------------|----------------|--------|--------|----------------|--------|--------|----------|----------------|--------|---------------|--------|----------------|--------|--------|
|                                                                                   |   |   |           |   | Additional |   |           | Stock and |   |   | Acquired       |   |   |     |           |   | Other         |   |           |   |   |
|                                                                                   |   | Common |           |   | Paid-in    |   |           | Deferred       |   |   | By             |   |   | Retained |           |   | Comprehensive |   |           |   |   |
|                                                                                   |   | Stock  |           |   | Capital    |   |           | Compensation   |   |   | ESOP           |   |   | Earnings |           |   | Loss          |   |           | Total  |   |
| Balance, January 1, 2009                                                               |   | $      | 5,190          |   |       | $      | 25,656         |           |   | $      | (2,986         | )      |   | $        | (2,718         | )      |          | $      | 9,856          |   |   | $ | (1,094 | ) |   | $ | 33,904 |   |
| Comprehensive income                                                                   |   |   |           |   |       |   |           |           |   |   |           |   |   |     |           |   |          |   |           |   |   |   |   |   |   |   |   |   |
| Net income                                                                             |   |   | –– |   |       |   | –– |           |   |   | –– |   |   |     | –– |   |          |   | 2,905          |   |   |   | –– |   |   |   | 2,905 |   |
| Unrealized gains on securities designated as available for sale, net of related taxes  |   |   | –– |   |       |   | –– |           |   |   | –– |   |   |     | –– |   |          |   | –– |   |   |   | 296 |   |   |   | 296 |   |
| Defined benefit plan                                                                   |   |   | –– |   |       |   | –– |           |   |   | –– |   |   |     | –– |   |          |   | –– |   |   |   | 291 |   |   |   | 291 |   |
| Total comprehensive income                                                             |   |   |           |   |       |   |           |           |   |   |           |   |   |     |           |   |          |   |           |   |   |   |   |   |   |   | 3,492 |   |
| Cash dividends - $0.56 per share                                                       |   |   | –– |   |       |   | (2,872         | )              |   |   | –– |   |   |     | –– |   |          |   | –– |   |   |   | –– |   |   |   | (2,872 | ) |
| Shares purchased for deferred compensation plan                                        |   |   | –– |   |       |   | 240            |           |   |   | (69            | )      |   |     | –– |   |          |   | –– |   |   |   | –– |   |   |   | 171 |   |
| Shares distributed from deferred compensation plan                                     |   |   | –– |   |       |   | (59            | )              |   |   | 59             |   |   |     | –– |   |          |   | –– |   |   |   | –– |   |   |   | –– |   |
| Purchase of treasury stock - at cost                                                   |   |   | –– |   |       |   | –– |           |   |   | (86            | )      |   |     | –– |   |          |   | –– |   |   |   | –– |   |   |   | (86 | ) |
| Common stock issuance related to share-based compensation plans                        |   |   | 180            |   |       |   | (180           | )              |   |   | –– |   |   |     | –– |   |          |   | –– |   |   |   | –– |   |   |   | –– |   |
| Expense related to share-based compensation plans                                      |   |   | –– |   |       |   | 79             |           |   |   | –– |   |   |     | –– |   |          |   | –– |   |   |   | –– |   |   |   | 79 |   |
| Purchase of shares by Dividend Reinvestment Plan                                       |   |   | –– |   |       |   | (20            | )              |   |   | 351            |   |   |     | –– |   |          |   | –– |   |   |   | –– |   |   |   | 331 |   |
| Amortization of ESOP                                                                   |   |   | –– |   |       |   | (14            | )              |   |   | –– |   |   |     | 206            |   |          |   | –– |   |   |   | –– |   |   |   | 192 |   |
| Balance, December 31, 2009                                                             |   |   | 5,370          |   |       |   | 22,830         |           |   |   | (2,731         | )      |   |     | (2,512         | )      |          |   | 12,761         |   |   |   | (507 | ) |   |   | 35,211 |   |
|                                                                                   |   |   |           |   |       |   |           |           |   |   |           |   |   |     |           |   |          |   |           |   |   |   |   |   |   |   |   |   |
| Comprehensive income                                                                   |   |   |           |   |       |   |           |           |   |   |           |   |   |     |           |   |          |   |           |   |   |   |   |   |   |   |   |   |
| Net income                                                                             |   |   | –– |   |       |   | –– |           |   |   | –– |   |   |     | –– |   |          |   | 2,547          |   |   |   | –– |   |   |   | 2,547 |   |
| Unrealized losses on securities designated as available for sale, net of related taxes |   |   | –– |   |       |   | –– |           |   |   | –– |   |   |     | –– |   |          |   | –– |   |   |   | (213 | ) |   |   | (213 | ) |
| Defined benefit plan                                                                   |   |   | –– |   |       |   | –– |           |   |   | –– |   |   |     | –– |   |          |   | –– |   |   |   | 13 |   |   |   | 13 |   |
| Total comprehensive income                                                             |   |   |           |   |       |   |           |           |   |   |           |   |   |     |           |   |          |   |           |   |   |   |   |   |   |   | 2,347 |   |
| Cash dividends - $0.56 per share                                                       |   |   | –– |   |       |   | (2,960         | )              |   |   | –– |   |   |     | –– |   |          |   | –– |   |   |   | –– |   |   |   | (2.960 | ) |
| Shares purchased for deferred compensation plan                                        |   |   | –– |   |       |   | 195            |           |   |   | (91            | )      |   |     | –– |   |          |   | –– |   |   |   | –– |   |   |   | 104 |   |
| Shares distributed from deferred compensation plan                                     |   |   | –– |   |       |   | (45            | )              |   |   | 45             |   |   |     | –– |   |          |   | –– |   |   |   | –– |   |   |   | –– |   |
| Expense related to share-based compensation plans                                      |   |   | –– |   |       |   | 220            |           |   |   | –– |   |   |     | –– |   |          |   | –– |   |   |   | –– |   |   |   | 220 |   |
| Purchase of shares by Dividend Reinvestment Plan                                       |   |   | –– |   |       |   | (107           | )              |   |   | 565            |   |   |     | –– |   |          |   | –– |   |   |   | –– |   |   |   | 458 |   |
| Amortization of ESOP                                                                   |   |   | –– |   |       |   | –– |           |   |   | –– |   |   |     | 201            |   |          |   | –– |   |   |   | –– |   |   |   | 201 |   |
|                                                                                   |   |   |           |   |       |   |           |           |   |   |           |   |   |     |           |   |          |   |           |   |   |   |   |   |   |   |   |   |
| Balance, December 31, 2010                                                             |   | $      | 5,370          |   |       | $      | 20,133         |           |   | $      | (2,212         | )      |   | $        | (2,311         | )      |          | $      | 15,308         |   |   | $ | (707 | ) |   | $ | 35,581 |   |

----

|                                                                   |   | 2010   |           |   | 2009   |   |
|------------------------------------------------------------------------|--------|--------|----------------|--------|--------|--------|
| Operating Activities                                                   |   |   |           |   |   |   |
| Net income                                                             |   | $      | 2,547          |   |   | $      | 2,905 |   |
| Items not requiring (providing) cash                                   |   |   |           |   |   |   |   |   |
| Depreciation and amortization                                          |   |   | 815            |   |   |   | 748 |   |
| Amortization of intangible assets                                      |   |   | 113            |   |   |   | 119 |   |
| Provision for loan losses                                              |   |   | 1,816          |   |   |   | 1,325 |   |
| Provision for losses on foreclosed real estate                         |   |   | 90             |   |   |   | –– |   |
| Amortization of premiums and discounts on securities                   |   |   | 141            |   |   |   | 256 |   |
| Amortization and impairment of mortgage servicing rights               |   |   | 52             |   |   |   | 134 |   |
| Deferred income taxes                                                  |   |   | (365           | )      |   |   | (104 | ) |
| Gain on sales of securities                                            |   |   | (47            | )      |   |   | (154 | ) |
| Originations of loans held for sale                                    |   |   | (14,096        | )      |   |   | (10,687 | ) |
| Proceeds from sale of loans held for sale                              |   |   | 14,280         |   |   |   | 10,816 |   |
| Net gains on sales of loans                                            |   |   | (184           | )      |   |   | (129 | ) |
| Amortization of ESOP                                                   |   |   | 201            |   |   |   | 192 |   |
| Expense related to share-based compensation plans                      |   |   | 220            |   |   |   | 79 |   |
| Gain on sale of real estate and other repossessed assets               |   |   | (30            | )      |   |   | (105 | ) |
| Gain on sale of premises and equipment                                 |   |   | –– |   |   |   | (8 | ) |
| Increase in value of bank-owned life insurance                         |   |   | (383           | )      |   |   | (365 | ) |
| Changes in                                                             |   |   |           |   |   |   |   |   |
| Accrued interest receivable                                            |   |   | 777            |   |   |   | 819 |   |
| Other assets                                                           |   |   | 440            |   |   |   | (1,327 | ) |
| Interest payable and other liabilities                                 |   |   | 244            |   |   |   | (2,569 | ) |
|                                                                   |   |   |           |   |   |   |   |   |
| Net cash provided by operating activities                              |   |   | 6,631          |   |   |   | 1,945 |   |
|                                                                   |   |   |           |   |   |   |   |   |
| Investing Activities                                                   |   |   |           |   |   |   |   |   |
| Purchases of available-for-sale securities                             |   |   | (104,099       | )      |   |   | (67,773 | ) |
| Proceeds from maturities of available-for-sale securities              |   |   | 100,674        |   |   |   | 94,909 |   |
| Proceeds from sales of available-for-sale securities                   |   |   | 3,489          |   |   |   | 5,999 |   |
| Proceeds from maturities of held-to-maturity securities                |   |   | 6,927          |   |   |   | 1,444 |   |
| Proceeds from sales of held-to-maturity securities                     |   |   | 971            |   |   |   | –– |   |
| Net changes in certificates of deposit in other financial institutions |   |   | 15,011         |   |   |   | (17,575 | ) |
| Net change in loans                                                    |   |   | (23,604        | )      |   |   | (22,214 | ) |
| Purchases of premises and equipment                                    |   |   | (1,404         | )      |   |   | (1,014 | ) |
| Proceeds from sales of premises and equipment                          |   |   | –– |   |   |   | 51 |   |
| Proceeds from sales of foreclosed assets                               |   |   | 676            |   |   |   | 1,137 |   |
|                                                                   |   |   |           |   |   |   |   |   |
| Net cash used in investing activities                                  |   |   | (1,359         | )      |   |   | (5,036 | ) |

----

|                                                                                                 |   | 2010   |           |   | 2009   |   |
|------------------------------------------------------------------------------------------------------|--------|--------|----------------|--------|--------|--------|
| Financing Activities                                                                                 |   |   |           |   |   |   |
| Net decrease in deposits                                                                             |   | $      | (19,097        | )      |   | $      | (2,502 | ) |
| Net change in Federal Home Loan Bank advances and short term borrowings                              |   |   | (4,113         | )      |   |   | 7,851 |   |
| Cash dividends paid                                                                                  |   |   | (2,960         | )      |   |   | (2,872 | ) |
| Proceeds from purchase of shares by the dividend reinvestment plan                                   |   |   | 458            |   |   |   | 331 |   |
| Purchase of treasury stock                                                                           |   |   | –– |   |   |   | (86 | ) |
| Shares purchased for deferred compensation plan                                                      |   |   | 104            |   |   |   | 171 |   |
|                                                                                                 |   |   |           |   |   |   |   |   |
| Net cash (used in) provided by financing activities                                                  |   |   | (25,608        | )      |   |   | 2,893 |   |
|                                                                                                 |   |   |           |   |   |   |   |   |
| Decrease in Cash and Cash Equivalents                                                                |   |   | (20,336        | )      |   |   | (198 | ) |
|                                                                                                 |   |   |           |   |   |   |   |   |
| Cash and Cash Equivalents, Beginning of Year                                                         |   |   | 31,271         |   |   |   | 31,469 |   |
|                                                                                                 |   |   |           |   |   |   |   |   |
| Cash and Cash Equivalents, End of Year                                                               |   | $      | 10,935         |   |   | $      | 31,271 |   |
|                                                                                                 |   |   |           |   |   |   |   |   |
| Supplemental Cash Flows Information                                                                  |   |   |           |   |   |   |   |   |
| Interest paid on deposits and borrowings                                                             |   | $      | 6,541          |   |   | $      | 8,136 |   |
|                                                                                                 |   |   |           |   |   |   |   |   |
| Federal income taxes paid                                                                            |   | $      | 445            |   |   | $      | 557 |   |
|                                                                                                 |   |   |           |   |   |   |   |   |
| Supplemental Disclosure of Non-Cash Investing Activities                                             |   |   |           |   |   |   |   |   |
| Transfers from loans to foreclosed assets held for sale                                              |   | $      | 1,271          |   |   | $      | 1,002 |   |
|                                                                                                 |   |   |           |   |   |   |   |   |
| Unrealized (losses) gains on securities designated as available for sale, net of related tax effects |   | $      | (213           | )      |   | $      | 296 |   |
|                                                                                                 |   |   |           |   |   |   |   |   |
| Change in unfunded status of defined benefit plan liability                                          |   | $      | 20             |   |   | $      | 447 |   |
|                                                                                                 |   |   |           |   |   |   |   |   |
| Recognition of mortgage servicing rights                                                             |   | $      | –– |   |   | $      | 7 |   |

----

| Note 1: | Nature of Operations and Summary of Significant Accounting Policies |
|---------|---------------------------------------------------------------------|

----

----

----

----

|          |   | GrossCarryingAmount |   |   | 2010AccumulatedAmortization |   |   | 2009AccumulatedAmortization |   |
|---------------|--------|---------------------|--------|--------|-----------------------------|--------|--------|-----------------------------|--------|
|          |   | (In thousands)      |   |
|          |   |                |   |   |                        |   |   |                        |   |
| Core deposits |   | $                   | 812    |   |                        | $      | 269    |                        |   | $ | 156 |   |

----

----

----

| Note 2: | Restriction on Cash and Due From Banks |
|---------|----------------------------------------|

----

| Note 3: | Securities |
|---------|------------|

|                                                     |   | AmortizedCost  |   |   | GrossUnrealizedGains |   |   | GrossUnrealizedLosses |   |   | ApproximateFair Value |   |
|----------------------------------------------------------|--------|----------------|--------|--------|----------------------|--------|--------|-----------------------|--------|--------|----------------------------|--------|
|                                                     |   | (In thousands) |   |
| Available-for-sale Securities:                           |   |           |   |   |                 |   |   |                  |   |   |                       |   |
| December 31, 2010:                                       |   |           |   |   |                 |   |   |                  |   |   |                       |   |
| U.S. government agencies                                 |   | $              | 61,908 |   |                 | $      | 53     |                  |   | $      | (728                       | )      |   | $ | 61,233 |   |
| State and political subdivisions                         |   |           | 25,008 |   |                 |   | 315    |                  |   |   | (28                        | )      |   |   | 25,295 |   |
| Government sponsored entities mortgage-backed securities |   |           | 9,105  |   |                 |   | 509    |                  |   |   | ––             |   |   |   | 9,614 |   |
| Equity securities                                        |   |           | 4      |   |                 |   | 9      |                  |   |   | ––             |   |   |   | 13 |   |
|                                                     |   |           |   |   |                 |   |   |                  |   |   |                       |   |   |   |   |   |
|                                                     |   | $              | 96,025 |   |                 | $      | 886    |                  |   | $      | (756                       | )      |   | $ | 96,155 |   |
|                                                     |   |           |   |   |                 |   |   |                  |   |   |                       |   |   |   |   |   |
| December 31, 2009:                                       |   |           |   |   |                 |   |   |                  |   |   |                       |   |   |   |   |   |
| U.S. government agencies                                 |   | $              | 57,664 |   |                 | $      | 35     |                  |   | $      | (495                       | )      |   | $ | 57,204 |   |
| State and political subdivisions                         |   |           | 26,000 |   |                 |   | 421    |                  |   |   | (77                        | )      |   |   | 26,344 |   |
| Government sponsored entities mortgage-backed securities |   |           | 12,466 |   |                 |   | 567    |                  |   |   | (2                         | )      |   |   | 13,031 |   |
| Equity securities                                        |   |           | 4      |   |                 |   | 2      |                  |   |   | ––             |   |   |   | 6 |   |
|                                                     |   |           |   |   |                 |   |   |                  |   |   |                       |   |   |   |   |   |
|                                                     |   | $              | 96,134 |   |                 | $      | 1,025  |                  |   | $      | (574                       | )      |   | $ | 96,585 |   |

----

|                             |   | AmortizedCost  |   |   | GrossUnrealizedGains |   |   | GrossUnrealizedLosses |   |   | ApproximateFair Value |   |
|----------------------------------|--------|----------------|--------|--------|----------------------|--------|--------|-----------------------|--------|--------|----------------------------|--------|
|                             |   | (In thousands) |   |
| Held-to-maturity Securities:     |   |           |   |   |                 |   |   |                  |   |   |                       |   |
| December 31, 2010:               |   |           |   |   |                 |   |   |                  |   |   |                       |   |
| State and political subdivisions |   | $              | 6,331  |   |                 | $      | 179    |                  |   | $      | ––             |   |   | $ | 6,510 |   |
|                             |   |           |   |   |                 |   |   |                  |   |   |                       |   |   |   |   |   |
| December 31, 2009:               |   |           |   |   |                 |   |   |                  |   |   |                       |   |   |   |   |   |
| State and political subdivisions |   | $              | 14,277 |   |                 | $      | 391    |                  |   | $      | (25                        | )      |   | $ | 14,643 |   |

|              |   | Available-for-sale |   |   | Held-to-maturity |   |
|-------------------|--------|--------------------|--------|--------|------------------|--------|
|         |   | AmortizedCost      |   |   | Fair Value  |   |   | AmortizedCost |   |   | Fair Value |   |
|              |   | (In thousands)     |   |
|              |   |               |   |   |             |   |   |   |   |   |   |   |
| Within one year   |   | $                  | 170    |   |             | $      | 171 |   |   | $ | 710 |   |   | $ | 715 |   |
| One to five years |   |               | 19,449 |   |             |   | 19,499 |   |   |   | 2,374 |   |   |   | 2,479 |   |
| Five to ten years |   |               | 29,444 |   |             |   | 30,013 |   |   |   | 3,247 |   |   |   | 3,316 |   |
| After ten years   |   |               | 46,958 |   |             |   | 46,459 |   |   |   | –– |   |   |   | –– |   |
|              |   |               |   |   |             |   |   |   |   |   |   |   |   |   |   |   |
|              |   |               | 96,021 |   |             |   | 96,142 |   |   |   | 6,331 |   |   |   | 6,510 |   |
|              |   |               |   |   |             |   |   |   |   |   |   |   |   |   |   |   |
| Equity securities |   |               | 4      |   |             |   | 13 |   |   |   | –– |   |   |   | –– |   |
|              |   |               |   |   |             |   |   |   |   |   |   |   |   |   |   |   |
| Totals            |   | $                  | 96,025 |   |             | $      | 96,155 |   |   | $ | 6,331 |   |   | $ | 6,510 |   |

----

|                |   | Year ended December 31, |   |
|---------------------|--------|----------------------------------------|--------|
|                |   | 2010                                   |   |   | 2009 |   |
|                |   | (In thousands)                         |   |
|                |   |                                   |   |   |   |   |
| Proceeds from sales |   | $                                      | 4,460  |   |   | $ | 5,999 |   |
| Gross gains         |   |                                   | 104    |   |   |   | 154 |   |
| Gross losses        |   |                                   | (57    | ) |   |   | –– |   |
| Tax expense         |   |                                   | 16     |   |   |   | 52 |   |

----

| December 31, 2010           |   |
|---------------------------------------|--------|
|                             |   | Less than 12 Months |   |   | 12 Months or More |   |   | Total |   |
| Description ofSecurities         |   | Fair Value |   |   | UnrealizedLosses |   |   | Fair Value |   |   | UnrealizedLosses |   |   | Fair Value |   |   | UnrealizedLosses |   |
| (In thousands)                        |   |
|                                  |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| US Government agencies                |   | $ | 33,215 |   |   | $ | (728 | ) |   | $ | –– |   |   | $ | –– |   |   | $ | 33,215 |   |   | $ | (728 | ) |
|                                  |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| State and political subdivisions      |   |   | 2,484 |   |   |   | (28 | ) |   |   | –– |   |   |   | –– |   |   |   | 2,484 |   |   |   | (28 | ) |
|                                  |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total temporarily impaired securities |   | $ | 35,699 |   |   | $ | (756 | ) |   | $ | –– |   |   | $ | –– |   |   | $ | 35,699 |   |   | $ | (756 | ) |

| December 31, 2009                              |   |
|----------------------------------------------------------|--------|
|                                                |   | Less than 12 Months |   |   | 12 Months or More |   |   | Total |   |
| Description ofSecurities                            |   | Fair Value |   |   | UnrealizedLosses |   |   | Fair Value |   |   | UnrealizedLosses |   |   | Fair Value |   |   | UnrealizedLosses |   |
| (In thousands)                                           |   |
|                                                     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| US Government agencies                                   |   | $ | 40,699 |   |   | $ | (495 | ) |   | $ | –– |   |   | $ | –– |   |   | $ | 40,699 |   |   | $ | (495 | ) |
| Government sponsored entities mortgage-backed securities |   |   | 651 |   |   |   | (2 | ) |   |   | –– |   |   |   | –– |   |   |   | 651 |   |   |   | (2 | ) |
| State and political subdivisions                         |   |   | 4,037 |   |   |   | (43 | ) |   |   | 2,450 |   |   |   | (59 | ) |   |   | 6,487 |   |   |   | (102 | ) |
|                                                     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total temporarily impaired securities                    |   | $ | 45,387 |   |   | $ | (540 | ) |   | $ | 2,450 |   |   | $ | (59 | ) |   | $ | 47,837 |   |   | $ | (599 | ) |

----

| Note 4: | Loans and Allowance for Loan Losses |
|---------|-------------------------------------|

|                           |   | 2010           |    |   | 2009   |   |
|--------------------------------|--------|----------------|---------|--------|--------|--------|
|                           |   | (In thousands) |    |
|                           |   |           |    |   |   |   |
| Commercial loans               |   | $              | 32,153  |   |   | $      | 20,966 |   |
| Commercial real estate         |   |           | 136,369 |   |   |   | 129,757 |   |
| Residential real estate        |   |           | 63,378  |   |   |   | 62,128 |   |
| Installment loans              |   |           | 46,877  |   |   |   | 44,875 |   |
|                           |   |           |    |   |   |   |   |   |
| Total gross loans              |   |           | 278,777 |   |   |   | 257,726 |   |
|                           |   |           |    |   |   |   |   |   |
| Less allowance for loan losses |   |           | (2,740  | )      |   |   | (2,390 | ) |
|                           |   |           |    |   |   |   |   |   |
| Total loans                    |   | $              | 276,037 |   |   | $      | 255,336 |   |

|                         |   | 2010           |   |   | 2009   |   |
|------------------------------|--------|----------------|--------|--------|--------|--------|
|                         |   | (In thousands) |   |
|                         |   |           |   |   |   |   |
| Balance, beginning of year   |   | $              | 2,390  |   |   | $      | 2,770 |   |
| Provision charged to expense |   |           | 1,816  |   |   |   | 1,325 |   |
| Losses charged off           |   |           | (1,770 | )      |   |   | (1,930 | ) |
| Recoveries                   |   |           | 304    |   |   |   | 225 |   |
|                         |   |           |   |   |   |   |   |   |
| Balance, end of year         |   | $              | 2,740  |   |   | $      | 2,390 |   |

----

|                                                             |   | Commercial |   |   | CommercialReal Estate |   |    | Installment |   |   | Residential    |   |   | Unallocated |   |   | Total  |   |
|------------------------------------------------------------------|--------|------------|--------|--------|----------------------------|--------|---------|-------------|--------|--------|----------------|--------|--------|-------------|--------|--------|--------|--------|
| (In thousands)                                                   |   |
| Allowance for loan losses:                                       |   |       |   |   |                       |   |    |        |   |   |           |   |   |        |   |   |   |   |
| Balance, beginning of year                                       |   | $          | 890    |   |                       | $      | 999     |        |   | $      | 251            |   |   | $           | 100    |   |   | $      | 150 |   |   | $ | 2,390 |   |
| Provision charged to expense                                     |   |       | (110   | )      |                       |   | 1,339   |        |   |   | 296            |   |   |        | 197    |   |   |   | 94 |   |   |   | 1,816 |   |
| Losses charged off                                               |   |       | (256   | )      |                       |   | (775    | )           |   |   | (579           | )      |   |        | (160   | )      |   |   | –– |   |   |   | (1,770 | ) |
| Recoveries                                                       |   |       | 37     |   |                       |   | 3       |        |   |   | 261            |   |   |        | 3      |   |   |   | –– |   |   |   | 304 |   |
| Balance, end of year                                             |   | $          | 561    |   |                       | $      | 1,566   |        |   | $      | 229            |   |   | $           | 140    |   |   | $      | 244 |   |   | $ | 2,740 |   |
| Ending balance:  individually evaluated for impairment |   | $          | 486    |   |                       | $      | 1,226   |        |   | $      | –– |   |   | $           | 60     |   |   | $      | –– |   |   | $ | 1,772 |   |
| Ending balance:  collectively evaluated for impairment |   | $          | 75     |   |                       | $      | 340     |        |   | $      | 229            |   |   | $           | 80     |   |   | $      | 244 |   |   | $ | 968 |   |
|                                                             |   |       |   |   |                       |   |    |        |   |   |           |   |   |        |   |   |   |   |   |   |   |   |   |   |
| Loans:                                                           |   |       |   |   |                       |   |    |        |   |   |           |   |   |        |   |   |   |   |   |   |   |   |   |   |
| Ending balance:  individually evaluated for impairment |   | $          | 1,184  |   |                       | $      | 5,852   |        |   | $      | –– |   |   | $           | 238    |   |   | $      | –– |   |   | $ | 7,274 |   |
| Ending balance:  collectively evaluated for impairment |   | $          | 30,969 |   |                       | $      | 130,517 |        |   | $      | 46,877         |   |   | $           | 63,140 |   |   | $      | –– |   |   | $ | 271,503 |   |

----

| Loan Class |   | Commercial     |           |   | CommercialReal Estate |   |    | Residential |   |   | Installment    |   |
|-----------------|--------|----------------|----------------|--------|----------------------------|--------|---------|-------------|--------|--------|----------------|--------|
|            |   | (In thousands) |           |
|            |   |           |           |   |                       |   |    |        |   |   |           |   |
| Pass Grade      |   | $              | 28,416         |   |                       | $      | 122,795 |        |   | $      | 62,517         |   |   | $ | 46,877 |   |
| Special Mention |   |           | 134            |   |                       |   | 1,141   |        |   |   | 623            |   |   |   | –– |   |
| Substandard     |   |           | 3,603          |   |                       |   | 12,198  |        |   |   | 238            |   |   |   | –– |   |
| Doubtful        |   |           | –– |   |                       |   | 235     |        |   |   | –– |   |   |   | –– |   |
|            |   |           |           |   |                       |   |    |        |   |   |           |   |   |   |   |   |
|            |   | $              | 32,153         |   |                       | $      | 136,369 |        |   | $      | 63,378         |   |   | $ | 46,877 |   |

|                   |   | 30-59 DaysPast DueandAccruing |   |   | 60-89 DaysPast DueandAccruing |   |   | GreaterThan 90Days andAccruing |   |   | NonAccrual     |   |   | Total PastDue andNon Accrual |   |   | Current |   |   | Total LoansReceivable |   |
|------------------------|--------|-----------------------------------------|--------|--------|-----------------------------------------|--------|--------|------------------------------------------|--------|--------|----------------|--------|--------|---------------------------------------------|--------|--------|---------|--------|--------|----------------------------|--------|
|              |   | (In thousands)                     |   |
| Commercial             |   | $                                       | 265    |   |                                    | $      | 201    |                                     |   | $      | 25             |   |   | $                                           | 300    |   |    | $      | 791    |                       |   | $ | 31,362 |   |   | $ | 32,153 |   |
| Commercial real estate |   |                                    | 567    |   |                                    |   | 525    |                                     |   |   | –– |   |   |                                        | 3,163  |   |    |   | 4,255  |                       |   |   | 132,114 |   |   |   | 136,369 |   |
| Installment            |   |                                    | 421    |   |                                    |   | 159    |                                     |   |   | –– |   |   |                                        | 240    |   |    |   | 820    |                       |   |   | 46,057 |   |   |   | 46,877 |   |
| Residential            |   |                                    | 529    |   |                                    |   | 279    |                                     |   |   | –– |   |   |                                        | 823    |   |    |   | 1,631  |                       |   |   | 61,747 |   |   |   | 63,378 |   |
|                   |   |                                    |   |   |                                    |   |   |                                     |   |   |           |   |   |                                        |   |   |    |   |   |                       |   |   |   |   |   |   |   |   |
| Total                  |   | $                                       | 1,782  |   |                                    | $      | 1,164  |                                     |   | $      | 25             |   |   | $                                           | 4,526  |   |    | $      | 7,497  |                       |   | $ | 271,280 |   |   | $ | 278,777 |   |

----

|                                          |   | RecordedBalance |   |   | UnpaidPrincipalBalance |   |   | SpecificAllowance |   |   | AverageInvestment inImpairedLoans |   |   | InterestIncomeRecognized |   |
|-----------------------------------------------|--------|-----------------|--------|--------|------------------------|--------|--------|-------------------|--------|--------|----------------------------------------|--------|--------|--------------------------|--------|
|                                          |   | (In thousands)  |   |
| Loans without a specific valuation allowance: |   |            |   |   |                   |   |   |              |   |   |                                   |   |   |                     |   |
| Commercial                                    |   | $               | 518    |   |                   | $      | 518    |              |   | $      | ––                         |   |   | $                        | 510    |   |   | $ | 22 |   |
| Commercial real estate                        |   |            | 1,186  |   |                   |   | 1,186  |              |   |   | ––                         |   |   |                     | 1,172  |   |   |   | 45 |   |
| Residential                                   |   |            | 77     |   |                   |   | 77     |              |   |   | ––                         |   |   |                     | 69     |   |   |   | 4 |   |
|                                          |   |            | 1,781  |   |                   |   | 1,781  |              |   |   | ––                         |   |   |                     | 1,751  |   |   |   | 71 |   |
| Loans with a specific valuation allowance:    |   |            |   |   |                   |   |   |              |   |   |                                   |   |   |                     |   |   |   |   |   |   |
| Commercial                                    |   |            | 666    |   |                   |   | 666    |              |   |   | 486                                    |   |   |                     | 648    |   |   |   | 38 |   |
| Commercial  real estate             |   |            | 4,666  |   |                   |   | 4,666  |              |   |   | 1,226                                  |   |   |                     | 4,688  |   |   |   | 80 |   |
| Residential                                   |   |            | 161    |   |                   |   | 161    |              |   |   | 60                                     |   |   |                     | 148    |   |   |   | 3 |   |
|                                          |   |            | 5,493  |   |                   |   | 5,493  |              |   |   | 1,772                                  |   |   |                     | 5,484  |   |   |   | 121 |   |
|                                          |   |            |   |   |                   |   |   |              |   |   |                                   |   |   |                     |   |   |   |   |   |   |
| Total:                                        |   |            |   |   |                   |   |   |              |   |   |                                   |   |   |                     |   |   |   |   |   |   |
| Commercial                                    |   | $               | 1,184  |   |                   | $      | 1,184  |              |   | $      | 486                                    |   |   | $                        | 1,158  |   |   | $ | 60 |   |
| Commercial Real Estate                        |   | $               | 5,852  |   |                   | $      | 5,852  |              |   | $      | 1,226                                  |   |   | $                        | 5,860  |   |   | $ | 125 |   |
| Residential                                   |   | $               | 238    |   |                   | $      | 238    |              |   | $      | 60                                     |   |   | $                        | 217    |   |   | $ | 7 |   |

----

| Note 5: | Premises and Equipment |
|---------|------------------------|

|                             |   | 2010           |    |   | 2009   |   |
|----------------------------------|--------|----------------|---------|--------|--------|--------|
|                             |   | (In thousands) |    |
|                             |   |           |    |   |   |   |
| Land, buildings and improvements |   | $              | 11,941  |   |   | $      | 11,746 |   |
| Leasehold improvements           |   |           | 264     |   |   |   | 264 |   |
| Furniture and equipment          |   |           | 9,160   |   |   |   | 8,389 |   |
| Computer software                |   |           | 1,822   |   |   |   | 1,465 |   |
|                             |   |           |    |   |   |   |   |   |
|                             |   |           | 23,187  |   |   |   | 21,864 |   |
| Less accumulated depreciation    |   |           | (13,909 | )      |   |   | (13,175 | ) |
|                             |   |           |    |   |   |   |   |   |
| Net premises and equipment       |   | $              | 9,278   |   |   | $      | 8,689 |   |

| Note 6: | Loan Servicing |
|---------|----------------|

----

|                                                                 |   | 2010           |           |   | 2009   |   |
|----------------------------------------------------------------------|--------|----------------|----------------|--------|--------|--------|
|                                                                 |   | (In thousands) |           |
|                                                                 |   |           |           |   |   |   |
| Carrying amount, beginning of year                                   |   | $              | 267            |   |   | $      | 394 |   |
| Additions                                                            |   |           |           |   |   |   |   |   |
| Servicing obligations that result from transfers of financial assets |   |           | –– |   |   |   | 7 |   |
|                                                                 |   |           |           |   |   |   |   |   |
| Subtractions                                                         |   |           |           |   |   |   |   |   |
| Impairment of servicing asset                                        |   |           | (10            | )      |   |   | (86 | ) |
| Amortization                                                         |   |           | (42            | )      |   |   | (48 | ) |
|                                                                 |   |           |           |   |   |   |   |   |
| Carrying amount, end of year                                         |   | $              | 215            |   |   | $      | 267 |   |

| Fair value, beginning of year |   | $ | 267 |   |   | $ | 394 |   |
|-------------------------------|--------|---|-----|--------|--------|---|-----|--------|
| Fair value, end of year       |   | $ | 215 |   |   | $ | 267 |   |

| Note 7: | Interest-bearing Deposits |
|---------|---------------------------|

| Due during the year ending December 31, |   | (In thousands) |    |
|-----------------------------------------|--------|----------------|---------|
|                                    |   |           |    |
| 2011                                    |   | $              | 58,928  |   |
| 2012                                    |   |           | 41,557  |   |
| 2013                                    |   |           | 14,817  |   |
| 2014                                    |   |           | 5,694   |   |
| 2015                                    |   |           | 6,336   |   |
| Thereafter                              |   |           | 14,051  |   |
|                                    |   |           |    |   |
|                                    |   | $              | 141,383 |   |

----

| Note 8: | Borrowings |
|---------|------------|

|                                                                                                                |   | 2010           |           |   | 2009   |   |
|---------------------------------------------------------------------------------------------------------------------|--------|----------------|----------------|--------|--------|--------|
|                                                                                                                |   | (In thousands) |           |
| Maturities February 2011 through August 2025, primarily at fixed rates ranging from 2.88% to 7.20%, averaging 3.84% |   | $              | 43,450         |   |   | $      | –– |   |
| Maturities October 2010 through August 2025, primarily at fixed rates ranging from 2.88% to 7.20%, averaging 3.83%  |   |           | –– |   |   |   | 49,128 |   |
|                                                                                                                |   |           |           |   |   |   |   |   |
|                                                                                                                |   | $              | 43,450         |   |   | $      | 49,128 |   |

| For the year ending December 31, |   | (In thousands) |   |
|----------------------------------|--------|----------------|--------|
|                             |   |           |   |
| 2011                             |   | $              | 10,542 |   |
| 2012                             |   |           | 402    |   |
| 2013                             |   |           | 5,386  |   |
| 2014                             |   |           | 247    |   |
| 2015                             |   |           | 187    |   |
| Thereafter                       |   |           | 26,686 |   |
|                             |   |           |   |   |
|                             |   | $              | 43,450 |   |

----

|                                       |   | 2010                   |   |   | 2009   |   |
|--------------------------------------------|--------|------------------------|--------|--------|--------|--------|
|                                       |   | (Dollars in thousands) |   |
|                                       |   |                   |   |   |   |   |
| Balance outstanding at year end            |   | $                      | 11,321 |   |   | $      | 10,012 |   |
| Average daily balance during the year      |   | $                      | 12,734 |   |   | $      | 10,999 |   |
| Average interest rate during the year      |   |                   | 0.21   | %      |   |   | 0.39 | % |
| Maximum month-end balance during the year  |   | $                      | 14,931 |   |   | $      | 13,329 |   |
| Weighted-average interest rate at year end |   |                   | 0.21   | %      |   |   | 0.39 | % |

| Note 9: | Subordinated Debentures |
|---------|-------------------------|

| Note 10: | Income Taxes |
|----------|--------------|

|                    |   | 2010           |   |   | 2009   |   |
|-------------------------|--------|----------------|--------|--------|--------|--------|
|                    |   | (In thousands) |   |
|                    |   |           |   |   |   |   |
| Taxes currently payable |   | $              | 584    |   |   | $      | 620 |   |
| Deferred income taxes   |   |           | (365   | )      |   |   | (104 | ) |
|                    |   |           |   |   |   |   |   |   |
| Income tax expense      |   | $              | 219    |   |   | $      | 516 |   |

----

|                                        |   | 2010           |   |   | 2009   |   |
|---------------------------------------------|--------|----------------|--------|--------|--------|--------|
|                                        |   | (In thousands) |   |
|                                        |   |           |   |   |   |   |
| Computed at the statutory rate (34%)        |   | $              | 941    |   |   | $      | 1,163 |   |
| Decrease resulting from                     |   |           |   |   |   |   |   |   |
| Tax exempt interest                         |   |           | (484   | )      |   |   | (547 | ) |
| Earnings on bank-owned life insurance - net |   |           | (144   | )      |   |   | (113 | ) |
| Other                                       |   |           | (94    | )      |   |   | 13 |   |
|                                        |   |           |   |   |   |   |   |   |
| Actual tax expense                          |   | $              | 219    |   |   | $      | 516 |   |

|                                              |   | 2010           |   |   | 2009   |   |
|---------------------------------------------------|--------|----------------|--------|--------|--------|--------|
|                                              |   | (In thousands) |   |
|                                              |   |           |   |   |   |   |
| Deferred tax assets                               |   |           |   |   |   |   |
| Allowance for loan losses                         |   | $              | 488    |   |   | $      | 390 |   |
| Stock based compensation                          |   |           | 106    |   |   |   | 31 |   |
| Allowance for losses on foreclosed real estate    |   |           | 148    |   |   |   | 115 |   |
| Deferred compensation                             |   |           | 563    |   |   |   | 503 |   |
| Employee benefit expense                          |   |           | 225    |   |   |   | 132 |   |
| Intangible assets                                 |   |           | 51     |   |   |   | 32 |   |
| Non-accrual loan interest                         |   |           | 28     |   |   |   | 5 |   |
| Alternative minimum taxes                         |   |           | 344    |   |   |   | 345 |   |
|                                              |   |           |   |   |   |   |   |   |
| Total deferred tax assets                         |   |           | 1,953  |   |   |   | 1,553 |   |
|                                              |   |           |   |   |   |   |   |   |
| Deferred tax liabilities                          |   |           |   |   |   |   |   |   |
| Depreciation                                      |   |           | (143   | )      |   |   | (170 | ) |
| Deferred loan costs, net                          |   |           | (288   | )      |   |   | (191 | ) |
| Accretion                                         |   |           | (22    | )      |   |   | (34 | ) |
| FHLB stock dividends                              |   |           | (583   | )      |   |   | (583 | ) |
| Mortgage servicing rights                         |   |           | (73    | )      |   |   | (90 | ) |
| Unrealized gains on securities available for sale |   |           | (43    | )      |   |   | (152 | ) |
|                                              |   |           |   |   |   |   |   |   |
| Total deferred tax liabilities                    |   |           | (1,152 | )      |   |   | (1,220 | ) |
|                                              |   |           |   |   |   |   |   |   |
| Net deferred tax asset                            |   | $              | 801    |   |   | $      | 333 |   |

----

| Note 11: | Other Comprehensive Income (Loss) |
|----------|-----------------------------------|

|                                                                                               |   | 2010           |   |   | 2009   |   |
|----------------------------------------------------------------------------------------------------|--------|----------------|--------|--------|--------|--------|
|                                                                                               |   | (In thousands) |   |
|                                                                                               |   |           |   |   |   |   |
| Unrealized gains (losses) on available-for-sale securities                                         |   | $              | (247   | )      |   | $      | 602 |   |
| Reclassification adjustment for realized gains on available-for-sale securities included in income |   |           | (76    | )      |   |   | (154 | ) |
| Change in unfunded status of defined benefit plan liability                                        |   |           | (66    | )      |   |   | 320 |   |
| Amortization of prior service cost included in net periodic pension cost                           |   |           | 15     |   |   |   | 15 |   |
| Amortization of net loss included in net periodic pension cost                                     |   |           | 71     |   |   |   | 106 |   |
| Components of other comprehensive income (loss), before tax effect                                 |   |           | (303   | )      |   |   | 889 |   |
| Tax expense (benefit)                                                                              |   |           | (103   | )      |   |   | 302 |   |
|                                                                                               |   |           |   |   |   |   |   |   |
| Other comprehensive income (loss)                                                                  |   | $              | (200   | )      |   | $      | 587 |   |

|                                                                      |   | 2010           |   |   | 2009   |   |
|---------------------------------------------------------------------------|--------|----------------|--------|--------|--------|--------|
|                                                                      |   | (In thousands) |   |
|                                                                      |   |           |   |   |   |   |
| Net unrealized gain on securities available-for-sale                      |   | $              | 130    |   |   | $      | 451 |   |
| Net unrealized loss for unfunded status of defined benefit plan liability |   |           | (1,200 | )      |   |   | (1,220 | ) |
|                                                                      |   |           |   |   |   |   |   |   |
|                                                                      |   |           | (1,070 | )      |   |   | (769 | ) |
| Tax effect                                                                |   |           | 363    |   |   |   | 262 |   |
|                                                                      |   |           |   |   |   |   |   |   |
| Net-of-tax amount                                                         |   | $              | (707   | )      |   | $      | (507 | ) |

----

| Note 12: | Regulatory Matters |
|----------|--------------------|

----

|                                     |   | Actual                 |   |   | For Capital AdequacyPurposes |   |   | To Be Well CapitalizedUnder Prompt CorrectiveAction Provisions |   |
|------------------------------------------|--------|------------------------|--------|--------|----------------------------------------|--------|--------|----------------------------------------------------------------------------------------------|--------|
|                                     |   | Amount                 |   |   | Ratio                                  |   |   | Amount                                                                                       |   |   | Ratio |   |   | Amount |   |   | Ratio |   |
|                                     |   | (Dollars in thousands) |   |
| As of December 31, 2010                  |   |                   |   |   |                                   |   |   |                                                                                         |   |   |   |   |   |   |   |   |   |   |
| Total Capital (to Risk-Weighted Assets)  |   |                   |   |   |                                   |   |   |                                                                                         |   |   |   |   |   |   |   |   |   |   |
| Consolidated                             |   | $                      | 41,672 |   |                                   |   | 13.9   | %                                                                                            |   | $ | 24,052 |   |   |   | 8.0 | % |   | $ | N/A |   |   |   | N/A |   |
| Citizens                                 |   |                   | 40,049 |   |                                   |   | 13.3   |                                                                                         |   |   | 24,022 |   |   |   | 8.0 |   |   |   | 30,028 |   |   |   | 10.0 | % |
|                                     |   |                   |   |   |                                   |   |   |                                                                                         |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Tier I Capital (to Risk-Weighted Assets) |   |                   |   |   |                                   |   |   |                                                                                         |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Consolidated                             |   | $                      | 38,932 |   |                                   |   | 13.0   | %                                                                                            |   | $ | 12,026 |   |   |   | 4.0 | % |   | $ | N/A |   |   |   | N/A |   |
| Citizens                                 |   |                   | 37,309 |   |                                   |   | 12.4   |                                                                                         |   |   | 12,011 |   |   |   | 4.0 |   |   |   | 18,017 |   |   |   | 6.0 | % |
|                                     |   |                   |   |   |                                   |   |   |                                                                                         |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Tier I Capital (to Average Assets)       |   |                   |   |   |                                   |   |   |                                                                                         |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Consolidated                             |   | $                      | 38,932 |   |                                   |   | 8.7    | %                                                                                            |   | $ | 17,891 |   |   |   | 4.0 | % |   | $ | N/A |   |   |   | N/A |   |
| Citizens                                 |   |                   | 37,309 |   |                                   |   | 8.6    |                                                                                         |   |   | 17,392 |   |   |   | 4.0 |   |   |   | 21,740 |   |   |   | 5.0 | % |
|                                     |   |                   |   |   |                                   |   |   |                                                                                         |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| As of December 31, 2009                  |   |                   |   |   |                                   |   |   |                                                                                         |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total Capital (to Risk-Weighted Assets)  |   |                   |   |   |                                   |   |   |                                                                                         |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Consolidated                             |   | $                      | 41,425 |   |                                   |   | 14.4   | %                                                                                            |   | $ | 22,938 |   |   |   | 8.0 | % |   | $ | N/A |   |   |   | N/A |   |
| Citizens                                 |   |                   | 38,856 |   |                                   |   | 13.5   |                                                                                         |   |   | 22,954 |   |   |   | 8.0 |   |   |   | 28,693 |   |   |   | 10.0 | % |
|                                     |   |                   |   |   |                                   |   |   |                                                                                         |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Tier I Capital (to Risk-Weighted Assets) |   |                   |   |   |                                   |   |   |                                                                                         |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Consolidated                             |   | $                      | 39,035 |   |                                   |   | 13.6   | %                                                                                            |   | $ | 11,469 |   |   |   | 4.0 | % |   | $ | N/A |   |   |   | N/A |   |
| Citizens                                 |   |                   | 36,465 |   |                                   |   | 12.7   |                                                                                         |   |   | 11,477 |   |   |   | 4.0 |   |   |   | 17,216 |   |   |   | 6.0 | % |
|                                     |   |                   |   |   |                                   |   |   |                                                                                         |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Tier I Capital (to Average Assets)       |   |                   |   |   |                                   |   |   |                                                                                         |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Consolidated                             |   | $                      | 39,035 |   |                                   |   | 8.7    | %                                                                                            |   | $ | 17,996 |   |   |   | 4.0 | % |   | $ | N/A |   |   |   | N/A |   |
| Citizens                                 |   |                   | 36,465 |   |                                   |   | 8.1    |                                                                                         |   |   | 18,076 |   |   |   | 4.0 |   |   |   | 22,595 |   |   |   | 5.0 | % |

----

| Note 13: | Related Party Transactions |
|----------|----------------------------|

|                                  |   | 2010           |   |   | 2009   |   |
|---------------------------------------|--------|----------------|--------|--------|--------|--------|
|                                  |   | (In thousands) |   |
|                                  |   |           |   |   |   |   |
| Aggregate balance – January 1   |   | $              | 9,450  |   |   | $      | 10,602 |   |
| New loans                             |   |           | 1,216  |   |   |   | 399 |   |
| Repayments                            |   |           | (1,820 | )      |   |   | (1,551 | ) |
|                                  |   |           |   |   |   |   |   |   |
| Aggregate balance – December 31 |   | $              | 8,846  |   |   | $      | 9,450 |   |

| Note 14: | Benefit Plans |
|----------|---------------|

----

|                                |   | Pension Benefits |   |
|-------------------------------------|--------|------------------|--------|
|                                |   | 2010             |   |   | 2009 |   |
|                                |   | (In thousands)   |   |
| Change in benefit obligation        |   |             |   |   |   |   |
| Beginning of year                   |   | $                | (3,133 | ) |   | $ | (2,838 | ) |
| Service cost                        |   |             | (266   | ) |   |   | (249 | ) |
| Interest cost                       |   |             | (180   | ) |   |   | (165 | ) |
| Actuarial gain (loss)               |   |             | (182   | ) |   |   | 5 |   |
| Benefits paid                       |   |             | 449    |   |   |   | 114 |   |
|                                |   |             |   |   |   |   |   |   |
| End of year                         |   |             | (3,312 | ) |   |   | (3,133 | ) |
|                                |   |             |   |   |   |   |   |   |
| Change in fair value of plan assets |   |             |   |   |   |   |   |   |
| Beginning of year                   |   |             | 2,669  |   |   |   | 1,917 |   |
| Actual return on plan assets        |   |             | 349    |   |   |   | 466 |   |
| Employer contribution               |   |             | 400    |   |   |   | 400 |   |
| Benefits paid                       |   |             | (449   | ) |   |   | (114 | ) |
|                                |   |             |   |   |   |   |   |   |
| End of year                         |   |             | 2,969  |   |   |   | 2,669 |   |
|                                |   |             |   |   |   |   |   |   |
| Funded status at end of year        |   | $                | (343   | ) |   | $ | (464 | ) |

|                           |   | Pension Benefits |   |
|--------------------------------|--------|------------------|--------|
|                           |   | 2010             |   |   | 2009 |   |
|                           |   | (In thousands)   |   |
|                           |   |             |   |   |   |   |
| Unamortized net loss           |   | $                | 1,155  |   |   | $ | 1,159 |   |
| Unamortized prior service cost |   |             | 45     |   |   |   | 61 |   |
|                           |   |             |   |   |   |   |   |   |
|                           |   | $                | 1,200  |   |   | $ | 1,220 |   |

----

|                           |   | December 31,   |   |
|--------------------------------|--------|----------------|--------|
|                           |   | 2010           |   |   | 2009 |   |
|                           |   | (In thousands) |   |
|                           |   |           |   |   |   |   |
| Projected benefit obligation   |   | $              | 3,312  |   |   | $ | 3,133 |   |
| Accumulated benefit obligation |   | $              | 2,366  |   |   | $ | 2,278 |   |
| Fair value of plan assets      |   | $              | 2,969  |   |   | $ | 2,669 |   |

|                                    |   | December 31,   |   |
|-----------------------------------------|--------|----------------|--------|
|                                    |   | 2010           |   |   | 2009 |   |
|                                    |   | (In thousands) |   |
|                                    |   |           |   |   |   |   |
| Components of net periodic benefit cost |   |           |   |   |   |   |
| Service cost                            |   | $              | 266    |   |   | $ | 249 |   |
| Interest cost                           |   |           | 180    |   |   |   | 165 |   |
| Expected return on plan assets          |   |           | (234   | ) |   |   | (151 | ) |
| Amortization of prior service cost      |   |           | 15     |   |   |   | 15 |   |
| Amortization of net loss                |   |           | 71     |   |   |   | 106 |   |
|                                    |   |           |   |   |   |   |   |   |
| Net periodic benefit cost               |   | $              | 298    |   |   | $ | 384 |   |

|                                                               |   | Pension Benefits |   |
|--------------------------------------------------------------------|--------|------------------|--------|
|                                                               |   | 2010             |   |   | 2009 |   |
|                                                               |   |             |   |   |   |   |
| Weighted-average assumptions used to determine benefit obligation: |   |             |   |   |   |   |
| Discount rate                                                      |   |             | 5.54   | % |   |   | 5.96 | % |
| Rate of compensation increase                                      |   |             | 3.00   | % |   |   | 3.00 | % |
|                                                               |   |             |   |   |   |   |   |   |
| Weighted-average assumptions used to determine benefit cost:       |   |             |   |   |   |   |   |   |
| Discount rate                                                      |   |             | 5.96   | % |   |   | 5.87 | % |
| Expected return on plan assets                                     |   |             | 8.00   | % |   |   | 8.00 | % |
| Rate of compensation increase                                      |   |             | 3.00   | % |   |   | 4.50 | % |

----

|      |   | PensionBenefits |   |
|-----------|--------|-----------------|--------|
|      |   | (In thousands)  |   |
|      |   |            |   |
| 2011      |   | $               | 390    |   |
| 2012      |   |            | 174    |   |
| 2013      |   |            | 141    |   |
| 2014      |   |            | 162    |   |
| 2015      |   |            | 124    |   |
| 2016-2019 |   |            | 1,914  |   |
|      |   |            |   |   |
| Total     |   | $               | 2,905  |   |

| Large-Cap stocks                |   | Not to exceed 60% |
|---------------------------------|--------|-------------------|
| SMID-Cap stocks                 |   | Not to exceed 20% |
| International equity securities |   | Not to exceed 15% |
| Fixed income investments        |   | Not to exceed 40% |
| Alternative investments         |   | Not to exceed 20% |

----

|                      |   | December 31, |   |
|---------------------------|--------|-------------------|--------|
|                      |   | 2010              |   |   | 2009 |   |
|                      |   |              |   |   |   |   |
| Equity securities         |   |              | 74.9   | % |   |   | 75.7 | % |
| Debt securities           |   |              | 24.0   |   |   |   | 23.5 |   |
| Cash and cash equivalents |   |              | 1.1    |   |   |   | 0.8 |   |
|                      |   |              |   |   |   |   |   |   |
|                      |   |              | 100.0  | % |   |   | 100.0 | % |

----

| December 31, 2010       |   |
|-----------------------------------|--------|
|                         |   |   |   |   | Fair Value Measurements Using |   |
| Asset Category               |   | Total Fair Value |   |   | Quoted Pricesin ActiveMarkets forIdentical Assets(Level 1) |   |   | SignificantOtherObservableInputs(Level 2) |   |   | SignificantUnobservableInputs(Level 3) |   |
|                         |   | (In thousands) |   |
|                              |   |   |   |   |   |   |   |   |   |   |   |   |
| Mutual money market               |   | $ | 32 |   |   | $ | 32 |   |   | $ | –– |   |   | $ | –– |   |
| Mutual funds – equities     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| International                     |   |   | 209 |   |   |   | 209 |   |   |   | –– |   |   |   | –– |   |
| Real estate                       |   |   | 30 |   |   |   | 30 |   |   |   | –– |   |   |   | –– |   |
| Large Cap                         |   |   | 1,157 |   |   |   | 1,157 |   |   |   | –– |   |   |   | –– |   |
| Small and Mid Cap                 |   |   | 799 |   |   |   | 799 |   |   |   | –– |   |   |   | –– |   |
| Commodities                       |   |   | 30 |   |   |   | 30 |   |   |   |   |   |   |   |   |   |
| Mutual funds – fixed income |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Core bond                         |   |   | 593 |   |   |   | 593 |   |   |   | –– |   |   |   | –– |   |
| High yield corporate              |   |   | 119 |   |   |   | 119 |   |   |   | –– |   |   |   | –– |   |
|                              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total                             |   | $ | 2,969 |   |   | $ | 2,969 |   |   | $ | –– |   |   | $ | –– |   |

| December 31, 2009       |   |
|-----------------------------------|--------|
|                         |   |   |   |   | Fair Value Measurements Using |   |
| Asset Category               |   | Total Fair Value |   |   | Quoted Pricesin ActiveMarkets forIdentical Assets(Level 1) |   |   | SignificantOtherObservableInputs(Level 2) |   |   | SignificantUnobservableInputs(Level 3) |   |
|                         |   | (In thousands) |   |
|                              |   |   |   |   |   |   |   |   |   |   |   |   |
| Mutual money market               |   | $ | 21 |   |   | $ | 21 |   |   | $ | –– |   |   | $ | –– |   |
| Mutual funds – equities     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| International                     |   |   | 212 |   |   |   | 212 |   |   |   | –– |   |   |   | –– |   |
| Real estate                       |   |   | 28 |   |   |   | 28 |   |   |   | –– |   |   |   | –– |   |
| Large cap                         |   |   | 1,045 |   |   |   | 1,045 |   |   |   | –– |   |   |   | –– |   |
| Small and Mid Cap                 |   |   | 734 |   |   |   | 734 |   |   |   |   |   |   |   |   |   |
| Mutual funds – fixed income |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Core bond                         |   |   | 545 |   |   |   | 545 |   |   |   | –– |   |   |   | –– |   |
| High yield corporate              |   |   | 84 |   |   |   | 84 |   |   |   | –– |   |   |   | –– |   |
|                              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total                             |   | $ | 2,669 |   |   | $ | 2,669 |   |   | $ | –– |   |   | $ | –– |   |

----

|                                                 |   | 2010   |      |   | 2009   |   |
|------------------------------------------------------|--------|--------|-----------|--------|--------|--------|
|                                                 |   |   |      |   |   |   |
| Allocated shares at beginning of the year            |   |   | 87,201    |   |   |   | 64,750 |   |
| Shares released for allocation during the year       |   |   | 23,639    |   |   |   | 23,639 |   |
| Shares distributed due to retirement/diversification |   |   | (869      | )      |   |   | (1,188 | ) |
| Unearned shares                                      |   |   | 236,357   |   |   |   | 259,996 |   |
|                                                 |   |   |      |   |   |   |   |   |
| Total ESOP shares                                    |   |   | 346,328   |   |   |   | 347,197 |   |
|                                                 |   |   |      |   |   |   |   |   |
| Fair value of unearned shares at December 31         |   | $      | 2,059,000 |   |   | $      | 2,218,000 |   |

----

| Note 15: | Stock Option and Restricted Stock Plans |
|----------|-----------------------------------------|

|                           |   | 2010   |           |
|--------------------------------|--------|--------|----------------|
|                      |   | Shares |           |   | Weighted-AverageExercise Price |   |   | Weighted-AverageRemainingContractualTerm (Years) |   |   | AggregateIntrinsic Value |   |
|                           |   |   |           |   |   |   |   |   |   |   |   |   |
| Outstanding, beginning of year |   |   | 53,714         |   |   | $ | 10.34 |   |   |   |   |   |   |   |
| Granted                        |   |   | –– |   |   |   | –– |   |   |   |   |   |   |   |
| Exercised                      |   |   | –– |   |   |   | –– |   |   |   |   |   |   |   |
| Forfeited or expired           |   |   | –– |   |   |   | –– |   |   |   |   |   |   |   |
|                           |   |   |           |   |   |   |   |   |   |   |   |   |   |   |
| Outstanding, end of year       |   |   | 53,714         |   |   | $ | 10.34 |   |   |   | 4.2 |   |   | $ | –– |   |
|                           |   |   |           |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Exercisable, end of year       |   |   | –– |   |   | $ | –– |   |   |   | –– |   |   | $ | –– |   |

----

|                         |   | Shares |           |   | Weighted-AverageGrant-DateFair Value |   |
|------------------------------|--------|--------|----------------|--------|-------------------------------------------|--------|
|                         |   |   |           |   |                                      |   |
| Nonvested, beginning of year |   |   | 180,000        |   |                                      | $      | 8.35 |   |
| Granted                      |   |   | –– |   |                                      |   | –– |   |
| Vested                       |   |   | –– |   |                                      |   | –– |   |
| Forfeited                    |   |   | –– |   |                                      |   | –– |   |
| Nonvested, end of year       |   |   | 180,000        |   |                                      | $      | 8.35 |   |

----

| Note 16: | Earnings Per Share |
|----------|--------------------|

|                                                            |   | Year Ended December 31, 2010 |   |
|-----------------------------------------------------------------|--------|--------------------------------------------------|--------|
|                                                       |   | NetIncome                                        |   |   | Weighted-AverageShares |   |   | Per ShareAmount |   |
|                                                            |   | (In thousands)                                   |   |   |   |   |   |   |   |
|                                                            |   |                                             |   |   |   |   |   |   |   |
| Net income                                                      |   | $                                                | 2,547  |   |   |   |   |   |   |   |
|                                                            |   |                                             |   |   |   |   |   |   |   |   |
| Dividends on non-vested restricted stock                        |   |                                             | (101   | ) |   |   |   |   |   |   |
|                                                            |   |                                             |   |   |   |   |   |   |   |   |
| Net income allocated to stockholders                            |   |                                             | 2,446  |   |   |   |   |   |   |   |
|                                                            |   |                                             |   |   |   |   |   |   |   |   |
| Basic earnings per share                                        |   |                                             |   |   |   |   |   |   |   |   |
| Income available to common stockholders                         |   |                                             |   |   |   |   | 4,690,458 |   |   | $ | 0.52 |   |
|                                                            |   |                                             |   |   |   |   |   |   |   |   |   |   |
| Effect of dilutive securities                                   |   |                                             |   |   |   |   |   |   |   |   |   |   |
| Restricted stock awards                                         |   |                                             |   |   |   |   | 27,192 |   |   |   |   |   |
|                                                            |   |                                             |   |   |   |   |   |   |   |   |   |   |
| Diluted earnings per share                                      |   |                                             |   |   |   |   |   |   |   |   |   |   |
| Income available to common stockholders and assumed conversions |   | $                                                | 2,446  |   |   | $ | 4,717,650 |   |   | $ | 0.52 |   |

----

|                                                            |   | Year Ended December 31, 2009 |   |
|-----------------------------------------------------------------|--------|--------------------------------------------------|--------|
|                                                            |   | NetIncome                                        |   |   | Weighted-AverageShares |   |   | Per ShareAmount |   |
|                                                            |   | (In thousands)                                   |   |   |   |   |   |   |   |
|                                                            |   |                                             |   |   |   |   |   |   |   |
| Net income                                                      |   | $                                                | 2,905  |   |   |   |   |   |   |   |
|                                                            |   |                                             |   |   |   |   |   |   |   |   |
| Dividends on non-vested restricted stock                        |   |                                             | (50    | ) |   |   |   |   |   |   |
|                                                            |   |                                             |   |   |   |   |   |   |   |   |
| Net income allocated to stockholders                            |   |                                             | 2,855  |   |   |   |   |   |   |   |
|                                                            |   |                                             |   |   |   |   |   |   |   |   |
| Basic earnings per share                                        |   |                                             |   |   |   |   |   |   |   |   |
| Income available to common stockholders                         |   |                                             |   |   |   |   | 4,631,066 |   |   | $ | 0.62 |   |
|                                                            |   |                                             |   |   |   |   |   |   |   |   |   |   |
| Effect of dilutive securities                                   |   |                                             |   |   |   |   |   |   |   |   |   |   |
| Restricted stock awards                                         |   |                                             |   |   |   |   | 68 |   |   |   |   |   |
|                                                            |   |                                             |   |   |   |   |   |   |   |   |   |   |
| Diluted earnings per share                                      |   |                                             |   |   |   |   |   |   |   |   |   |   |
| Income available to common stockholders and assumed conversions |   | $                                                | 2,855  |   |   | $ | 4,631,134 |   |   | $ | 0.62 |   |

----

| Note 17: | Disclosures about Fair Value of Financial Instruments and Other Assets and Liabilities |
|----------|----------------------------------------------------------------------------------------|

|   | Level 1 | Quoted prices in active markets for identical assets or liabilities |
|--------|---------|---------------------------------------------------------------------|

|   | Level 2 | Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities |
|--------|---------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | Level 3 | Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities |
|--------|---------|------------------------------------------------------------------------------------------------------------------------------------------------|

----

|                                                     |   |                |   |   | December 31, 2010Fair Value Measurements Using             |   |
|----------------------------------------------------------|--------|---------------------|--------|--------|-------------------------------------------------------------------------------------|--------|
|                                                |   | Fair Value     |   |   | Quoted Prices inActive Marketsfor IdenticalAssets(Level 1) |   |   | SignificantOtherObservableInputs(Level 2) |   |   | SignificantUnobservableInputs(Level 3) |   |
|                                                |   | (In thousands) |   |
| U.S government agencies                        |   | $                   | 61,233 |   |                                                                                | $      | –– |   |   | $ | 61,233 |   |   | $ | –– |   |
|                                                     |   |                |   |   |                                                                                |   |   |   |   |   |   |   |   |   |   |   |
| State and political subdivisions                         |   |                | 25,295 |   |                                                                                |   | –– |   |   |   | 25,295 |   |   |   | –– |   |
|                                                     |   |                |   |   |                                                                                |   |   |   |   |   |   |   |   |   |   |   |
| Government sponsored entities mortgage-backed securities |   |                | 9,614  |   |                                                                                |   | –– |   |   |   | 9,614 |   |   |   | –– |   |
|                                                     |   |                |   |   |                                                                                |   |   |   |   |   |   |   |   |   |   |   |
| Equity securities                                        |   |                | 13     |   |                                                                                |   | 13 |   |   |   | –– |   |   |   | –– |   |

|                                                     |   |                |   |   | December 31, 2009Fair Value Measurements Using             |   |
|----------------------------------------------------------|--------|---------------------|--------|--------|-------------------------------------------------------------------------------------|--------|
|                                                |   | Fair Value     |   |   | Quoted Prices inActive Marketsfor IdenticalAssets(Level 1) |   |   | SignificantOtherObservableInputs(Level 2) |   |   | SignificantUnobservableInputs(Level 3) |   |
|                                                     |   | (In thousands) |   |
| U.S government agencies                                  |   | $                   | 57,204 |   |                                                                                | $      | –– |   |   | $ | 57,204 |   |   | $ | –– |   |
|                                                     |   |                |   |   |                                                                                |   |   |   |   |   |   |   |   |   |   |   |
| State and political subdivisions                         |   |                | 26,344 |   |                                                                                |   | –– |   |   |   | 26,344 |   |   |   | –– |   |
|                                                     |   |                |   |   |                                                                                |   |   |   |   |   |   |   |   |   |   |   |
| Government sponsored entities mortgage-backed securities |   |                | 13,031 |   |                                                                                |   | –– |   |   |   | 13,031 |   |   |   | –– |   |
|                                                     |   |                |   |   |                                                                                |   |   |   |   |   |   |   |   |   |   |   |
| Equity securities                                        |   |                | 6      |   |                                                                                |   | 6 |   |   |   | –– |   |   |   | –– |   |

----

|                            |   |                |   |   | December 31, 2010Fair Value Measurements Using             |   |
|---------------------------------|--------|---------------------|--------|--------|-------------------------------------------------------------------------------------|--------|
|                       |   | Fair Value     |   |   | Quoted Prices inActive Marketsfor IdenticalAssets(Level 1) |   |   | SignificantOtherObservableInputs(Level 2) |   |   | SignificantUnobservableInputs(Level 3) |   |
|                            |   | (In thousands) |   |
| Impaired loans                  |   | $                   | 3,595  |   |                                                                                | $      | –– |   |   | $ | –– |   |   | $ | 3,595 |   |
| Mortgage servicing rights       |   |                | 215    |   |                                                                                |   | –– |   |   |   | –– |   |   |   | 215 |   |
| Foreclosed assets held for sale |   |                | 238    |   |                                                                                |   | –– |   |   |   | –– |   |   |   | 238 |   |

|                            |   |                |   |   | December 31, 2009Fair Value Measurements Using             |   |
|---------------------------------|--------|---------------------|--------|--------|-------------------------------------------------------------------------------------|--------|
|                       |   | Fair Value     |   |   | Quoted Prices inActive Marketsfor IdenticalAssets(Level 1) |   |   | SignificantOtherObservableInputs(Level 2) |   |   | SignificantUnobservableInputs(Level 3) |   |
|                            |   | (In thousands) |   |
| Impaired loans                  |   | $                   | 667    |   |                                                                                | $      | –– |   |   | $ | –– |   |   | $ | 667 |   |
| Mortgage servicing rights       |   |                | 267    |   |                                                                                |   | –– |   |   |   | –– |   |   |   | 267 |   |
| Foreclosed assets held for sale |   |                | 1,002  |   |                                                                                |   | –– |   |   |   | –– |   |   |   | 1,002 |   |

----

|                                                    |   | December 31, 2010 |    |   | December 31, 2009 |   |
|---------------------------------------------------------|--------|-----------------------------|---------|--------|-----------------------------|--------|
|                                                    |   | CarryingAmount              |    |   | FairValue                   |   |   | CarryingAmount |   |   | FairValue |   |
|                                                    |   | (In thousands)              |    |
|                                                    |   |                        |    |   |                        |   |   |   |   |   |   |   |
| Financial assets                                        |   |                        |    |   |                        |   |   |   |   |   |   |   |
| Cash and cash equivalents                               |   | $                           | 10,935  |   |                        | $      | 10,935 |   |   | $ | 31,271 |   |   | $ | 31,271 |   |
| Certificates of deposit in other financial institutions |   |                        | 2,564   |   |                        |   | 2,564 |   |   |   | 17,575 |   |   |   | 17,575 |   |
| Available-for-sale securities                           |   |                        | 96,155  |   |                        |   | 96,155 |   |   |   | 96,585 |   |   |   | 96,585 |   |
| Held-to-maturity securities                             |   |                        | 6,331   |   |                        |   | 6,510 |   |   |   | 14,277 |   |   |   | 14,643 |   |
| Loans, net of allowance for loan losses                 |   |                        | 276,037 |   |                        |   | 276,699 |   |   |   | 255,336 |   |   |   | 248,918 |   |
| Federal Home Loan Bank stock                            |   |                        | 4,810   |   |                        |   | 4,810 |   |   |   | 4,810 |   |   |   | 4,810 |   |
| Accrued interest receivable                             |   |                        | 1,441   |   |                        |   | 1,441 |   |   |   | 2,218 |   |   |   | 2,218 |   |
|                                                    |   |                        |    |   |                        |   |   |   |   |   |   |   |   |   |   |   |
| Financial liabilities                                   |   |                        |    |   |                        |   |   |   |   |   |   |   |   |   |   |   |
| Deposits                                                |   |                        | 325,446 |   |                        |   | 308,387 |   |   |   | 344,543 |   |   |   | 325,179 |   |
| Short-term borrowings                                   |   |                        | 11,843  |   |                        |   | 11,829 |   |   |   | 10,277 |   |   |   | 10,264 |   |
| Federal Home Loan Bank advances                         |   |                        | 43,450  |   |                        |   | 45,316 |   |   |   | 49,128 |   |   |   | 49,540 |   |
| Subordinated debentures                                 |   |                        | 4,000   |   |                        |   | 3,412 |   |   |   | 4,000 |   |   |   | 3,093 |   |
| Interest payable                                        |   |                        | 337     |   |                        |   | 337 |   |   |   | 398 |   |   |   | 398 |   |

----

| Note 18: | Significant Estimates and Concentrations |
|----------|------------------------------------------|

----

| Note 19: | Commitments and Credit Risk |
|----------|-----------------------------|

----

----

| Note 20: | Recent Accounting Pronouncements |
|----------|----------------------------------|

----

----

| Note 21: | Condensed Financial Information (Parent Company Only) |
|----------|-------------------------------------------------------|

|                                             |   | December 31,   |   |
|--------------------------------------------------|--------|----------------|--------|
|                                             |   | 2010           |   |   | 2009 |   |
|                                             |   | (In thousands) |   |
| Assets                                           |   |           |   |   |   |   |
| Cash and cash equivalents                        |   | $              | 1,812  |   |   | $ | 1,426 |   |
| Investment in the Bank                           |   |           | 37,958 |   |   |   | 37,446 |   |
| Corporate owned life insurance                   |   |           | 272    |   |   |   | 263 |   |
| Other assets                                     |   |           | 1,129  |   |   |   | 559 |   |
|                                             |   |           |   |   |   |   |   |   |
| Total assets                                     |   | $              | 41,171 |   |   | $ | 39,694 |   |
|                                             |   |           |   |   |   |   |   |   |
| Liabilities and Stockholders’ Equity       |   |           |   |   |   |   |   |   |
| Subordinated debentures                          |   | $              | 4,000  |   |   | $ | 4,000 |   |
| Other liabilities                                |   |           | 1,590  |   |   |   | 483 |   |
| Stockholders’ equity                       |   |           | 35,581 |   |   |   | 35,211 |   |
|                                             |   |           |   |   |   |   |   |   |
| Total liabilities and stockholders’ equity |   | $              | 41,171 |   |   | $ | 39,694 |   |

----

|                                                                        |   | Years Ended December 31, |   |
|-----------------------------------------------------------------------------|--------|-----------------------------------------|--------|
|                                                                        |   | 2010                                    |   |   | 2009 |   |
|                                                                        |   | (In thousands)                          |   |
|                                                                        |   |                                    |   |   |   |   |
| Operating Income                                                            |   |                                    |   |   |   |   |
| Dividends from subsidiary                                                   |   | $                                       | 3,154  |   |   | $ | 4,075 |   |
| Interest and dividend income from securities and federal funds              |   |                                    | 10     |   |   |   | 6 |   |
|                                                                        |   |                                    |   |   |   |   |   |   |
| Total operating income                                                      |   |                                    | 3,164  |   |   |   | 4,081 |   |
|                                                                        |   |                                    |   |   |   |   |   |   |
| General, Administrative and Other Expenses                                  |   |                                    | 1,907  |   |   |   | 1,893 |   |
|                                                                        |   |                                    |   |   |   |   |   |   |
| Income Before Income Taxes and Equity in Undistributed Income of Subsidiary |   |                                    | 1,257  |   |   |   | 2,188 |   |
|                                                                        |   |                                    |   |   |   |   |   |   |
| Income Tax Benefits                                                         |   |                                    | 563    |   |   |   | 648 |   |
|                                                                        |   |                                    |   |   |   |   |   |   |
| Income Before Equity in Undistributed Income of Subsidiary                  |   |                                    | 1,820  |   |   |   | 2,836 |   |
|                                                                        |   |                                    |   |   |   |   |   |   |
| Equity in Undistributed Income of Subsidiary                                |   |                                    | 727    |   |   |   | 69 |   |
|                                                                        |   |                                    |   |   |   |   |   |   |
| Net Income                                                                  |   | $                                       | 2,547  |   |   | $ | 2,905 |   |

----

|                                                                      |   | Years Ended December 31, |           |
|---------------------------------------------------------------------------|--------|-----------------------------------------|----------------|
|                                                                      |   | 2010                                    |           |   | 2009 |   |
|                                                                      |   | (In thousands)                          |           |
|                                                                      |   |                                    |           |   |   |   |
| Operating Activities                                                      |   |                                    |           |   |   |   |
| Net income                                                                |   | $                                       | 2,547          |   |   | $ | 2,905 |   |
| Items not requiring (providing) cash                                      |   |                                    |           |   |   |   |   |   |
| Depreciation and amortization                                             |   |                                    | 12             |   |   |   | 12 |   |
| Equity in undistributed income of subsidiary                              |   |                                    | (727           | ) |   |   | (69 | ) |
| Amortization of ESOP and share-based compensation plans                   |   |                                    | 421            |   |   |   | 271 |   |
| Net change in other assets and other liabilities                          |   |                                    | 531            |   |   |   | (362 | ) |
|                                                                      |   |                                    |           |   |   |   |   |   |
| Net cash provided by operating activities                                 |   |                                    | 2,784          |   |   |   | 2,757 |   |
|                                                                      |   |                                    |           |   |   |   |   |   |
| Financing Activities                                                      |   |                                    |           |   |   |   |   |   |
| Dividends paid to stockholders                                            |   |                                    | (2,960         | ) |   |   | (2,872 | ) |
| Proceeds from purchases of common stock by the dividend reinvestment plan |   |                                    | 458            |   |   |   | 331 |   |
| Treasury stock purchased                                                  |   |                                    | –– |   |   |   | (86 | ) |
| Shares purchased for deferred compensation plan                           |   |                                    | 104            |   |   |   | 171 |   |
|                                                                      |   |                                    |           |   |   |   |   |   |
| Net cash used in financing activities                                     |   |                                    | (2,398         | ) |   |   | (2,456 | ) |
|                                                                      |   |                                    |           |   |   |   |   |   |
| Net Change in Cash and Cash Equivalents                                   |   |                                    | 386            |   |   |   | 301 |   |
|                                                                      |   |                                    |           |   |   |   |   |   |
| Cash and Cash Equivalents at Beginning of Year                            |   |                                    | 1,426          |   |   |   | 1,125 |   |
|                                                                      |   |                                    |           |   |   |   |   |   |
| Cash and Cash Equivalents at End of Year                                  |   | $                                       | 1,812          |   |   | $ | 1,426 |   |

----

| Note 22: | Quarterly Financial Data (Unaudited) |
|----------|--------------------------------------|

|                                      |   | Three Months Ended               |   |
|-------------------------------------------|--------|--------------------------------------------|--------|
| 2010:                                     |   | March 31,                             |   |   | June 30, |   |   | September 30, |   |   | December 31, |   |
|                                 |   | (In thousands, except per share data) |   |
|                                      |   |                                       |   |   |   |   |   |   |   |   |   |   |
| Total interest income                     |   | $                                          | 5,530  |   |   | $ | 5,513 |   |   | $ | 5,403 |   |   | $ | 5,221 |   |
| Total interest expense                    |   |                                       | 1,804  |   |   |   | 1,715 |   |   |   | 1,582 |   |   |   | 1,379 |   |
|                                      |   |                                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net interest income                       |   |                                       | 3,726  |   |   |   | 3,798 |   |   |   | 3,821 |   |   |   | 3,842 |   |
|                                      |   |                                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Provision for loan losses                 |   |                                       | 360    |   |   |   | 370 |   |   |   | 321 |   |   |   | 765 |   |
| Other income                              |   |                                       | 776    |   |   |   | 859 |   |   |   | 849 |   |   |   | 786 |   |
| Gain on sale of securities - net          |   |                                       | -      |   |   |   | - |   |   |   | 47 |   |   |   | - |   |
| General, administrative and other expense |   |                                       | 3,371  |   |   |   | 3,471 |   |   |   | 3,687 |   |   |   | 3,393 |   |
|                                      |   |                                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Income before income taxes                |   |                                       | 771    |   |   |   | 816 |   |   |   | 709 |   |   |   | 470 |   |
| Federal income taxes                      |   |                                       | 88     |   |   |   | 115 |   |   |   | (1 | ) |   |   | 17 |   |
|                                      |   |                                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net income                                |   | $                                          | 683    |   |   | $ | 701 |   |   | $ | 710 |   |   | $ | 453 |   |
|                                      |   |                                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Earnings per share                        |   |                                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Basic                                     |   | $                                          | 0.14   |   |   | $ | 0.14 |   |   | $ | 0.15 |   |   | $ | 0.09 |   |
|                                      |   |                                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Diluted                                   |   | $                                          | 0.14   |   |   | $ | 0.14 |   |   | $ | 0.15 |   |   | $ | 0.09 |   |

----

|                                                |   | Three Months Ended                                   |           |
|-----------------------------------------------------|--------|----------------------------------------------------------------|----------------|
| 2009:                                               |   | March 31,                                                 |           |   | June 30, |   |   | September 30, |   |   | December 31, |   |
|                                           |   | (In thousands, except per share data) |           |
|                                                |   |                                                           |           |   |   |   |   |   |   |   |   |   |
| Total interest income                               |   | $                                                              | 5,913          |   |   | $ | 5,861 |   |   | $ | 5,841 |   |   | $ | 5,740 |   |
| Total interest expense                              |   |                                                           | 2,074          |   |   |   | 2,027 |   |   |   | 2,011 |   |   |   | 1,953 |   |
|                                                |   |                                                           |           |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net interest income                                 |   |                                                           | 3,839          |   |   |   | 3,834 |   |   |   | 3,830 |   |   |   | 3,787 |   |
|                                                |   |                                                           |           |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Provision for loan losses                           |   |                                                           | 324            |   |   |   | 334 |   |   |   | 338 |   |   |   | 329 |   |
| Other income                                        |   |                                                           | 789            |   |   |   | 788 |   |   |   | 828 |   |   |   | 736 |   |
| Gain on sale of available-for-sale securities - net |   |                                                           | –– |   |   |   | 25 |   |   |   | –– |   |   |   | 129 |   |
| General, administrative and other expense           |   |                                                           | 3,309          |   |   |   | 3,567 |   |   |   | 3,420 |   |   |   | 3,543 |   |
|                                                |   |                                                           |           |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Income before income taxes                          |   |                                                           | 995            |   |   |   | 746 |   |   |   | 900 |   |   |   | 780 |   |
| Federal income taxes                                |   |                                                           | 194            |   |   |   | 74 |   |   |   | 143 |   |   |   | 105 |   |
|                                                |   |                                                           |           |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net income                                          |   | $                                                              | 801            |   |   | $ | 672 |   |   | $ | 757 |   |   | $ | 675 |   |
|                                                |   |                                                           |           |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Earnings per share                                  |   |                                                           |           |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Basic                                               |   | $                                                              | 0.17           |   |   | $ | 0.15 |   |   | $ | 0.16 |   |   | $ | 0.14 |   |
|                                                |   |                                                           |           |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Diluted                                             |   | $                                                              | 0.17           |   |   | $ | 0.15 |   |   | $ | 0.16 |   |   | $ | 0.14 |   |

----